TEQSA v Chegg Inc. - Consumer Law Penalty

Original Word Document (2 MB) fFederal Court of Australia

Chief Executive Officer of the Tertiary Education Quality and Standards Agency v Chegg, Inc. [2026] FCA 330

| File number(s): | NSD 1427 of 2024 |
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| Judgment of: | LENEHAN J |
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| Date of judgment: | 27 March 2026 |
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| Catchwords: | CONSUMER LAW – where respondent admitted contraventions of s 114A(3) of the Tertiary Education Quality and Standards Agency Act 2011 (Cth) – where pecuniary penalty sought by applicant not opposed by respondent – construction of s 114A(3) of the Tertiary Education Quality and Standards Agency Act 2011 (Cth) and associated definitions – consideration of principles governing determination of a civil penalty that is appropriate – quantum of penalty proposed within the range of appropriate penalties – declarations and ancillary orders made in form sought by the parties |
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| Legislation: | Evidence Act 1995 (Cth), s 191

Federal Court of Australia Act 1976 (Cth), s 21

Regulatory Powers (Standard Provisions) Act 2014 (Cth), s 83

Tertiary Education Quality and Standards Act 2011 (Cth), ss 3, 5, 44A, 114A, 117

Tertiary Education Quality and Standards Agency Amendment (Prohibiting Academic Cheating Services) Bill 2019 (Cth)

Trade Practices Act 1974 (Cth) |
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| Cases cited: | Ainsworth v Criminal Justice Commission [1992] HCA 10; 175 CLR 564

Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27

Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3; 262 CLR 157

Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; 254 FCR 68

Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; 274 CLR 450

Australian Competition and Consumer Commission v Apple Pty Ltd (No 4) [2018] FCA 953

Australian Competition and Consumer Commission v Cement Australia Pty Ltd [2017] FCAFC 159; 258 FCR 312

Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Limited [2015] FCA 330; [2015] ATPR 42-494

Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2014] FCA 1405

Australian Competition and Consumer Commission v Cornerstone Investment Aust Pty Ltd (in liq) (No 4) [2018] FCA 1408

Australian Competition and Consumer Commission v Emma Sleep GmbH [2025] FCA 618

Australian Competition and Consumer Commission v Energy Australia Pty Ltd [2015] FCA 274; ATPR 42-491

Australian Competition and Consumer Commission v Productivity Partners Pty Limited (t/a Captain Cook College) (No 3) [2021] FCA 737;154 ACSR 472

Australian Competition and Consumer Commission v Uber B.V. [2022] FCA 1466

Commission v Bluescope Steel Ltd (No 5) [2022] FCA 1475

Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; 258 CLR 482

Construction, Forestry, Mining and Energy Union v Cahill [2010] FCAFC 39; 194 IR 461

Federal Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; 250 CLR 503

Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman [2023] FCA 72; 322 IR 233

Masons v Parsons [2019] HCA 21; 266 CLR 554

Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v Moorcroft [2021] HCA 19; 273 CLR 21

Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72; ATPR 41-993

NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134; 71 FCR 285

NZYQ v Minister for Immigration, Citizenship and Multicultural Affairs [2023] HCA 37; 280 CLR 137

Octet Finance Pty Ltd v Macgregor [2026] NSWSC 103

Palmanova Pty Ltd v Commonwealth of Australia [2025] HCA 35; 99 ALJR 1362

Registrar of Titles (WA) v Franzon [1975] HCA 41; 132 CLR 611

SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; 262 CLR 362

Trade Practices Commission v CSR Ltd [1990] FCA 521; ATPR 41-076

Volkswagen Aktiengesellschaft v Australian Competition and Consumer Commission [2021] FCAFC 49; 284 FCR 24

YBFZ v Minister for Immigration, Citizenship and Multicultural Affairs [2024] HCA 40; 99 ALJR 1; 419 ALR 457 |
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| Division: | General Division |
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| Registry: | New South Wales |
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| National Practice Area: | Commercial and Corporations |
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| Sub-area: | Regulator and Consumer Protection |
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| Number of paragraphs: | 120 |
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| Date of hearing: | 24 February 2026 |
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| Counsel for the Applicant: | Ms P Abdiel and Ms J Ibrahim |
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| Solicitor for the Applicant: | Australian Government Solicitor |
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| Counsel for the Respondent: | Ms K Morgan SC and Mr D Fuller |
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| Solicitor for the Respondent: | Minter Ellison |
ORDERS

| | | NSD 1427 of 2024 |
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| BETWEEN: | CHIEF EXECUTIVE OFFICER OF THE TERTIARY EDUCATION QUALITY AND STANDARDS AGENCY

Applicant | |
| AND: | CHEGG, INC.

Respondent | |

| order made by: | LENEHAN J |
| DATE OF ORDER: | 27 March 2026 |
THE COURT DECLARES THAT:

1. Between approximately 1 November 2021 and 31 May 2022, the respondent engaged in conduct that contravened s 114A(3) of the Tertiary Education Quality and Standards Act 2011 (Cth) (TEQ S A A ct) by providing or arranging for a third person to provide an academic cheating service to students undertaking an Australian course of study with Monash University, on the following occasions:

(a) between 1 and 2 May 2022, in respect of an assessment task issued by the Faculty of Engineering to students enrolled in the course “CIV2263 – Water Systems 2022”, which was entitled “Water Surface Profiles”;

(b) between 11 and 12 January 2022, in respect of an assessment task issued by the Faculty of Information Technology to students enrolled in the course “FIT1045 – Algorithms and Programming Fundamentals in Python”, which was entitled “Programming Assignment”; and

(c) on or about 1 November 2021, in respect of an assessment task issued by the Faculty of Information Technology to students enrolled in the course “FIT2094 – Databases”, which was an electronic examination.

THE COURT ORDERS THAT:

1. Within 30 days of the date of this order, the respondent pay to the Commonwealth of Australia a pecuniary penalty in the total amount of $500,000 in respect of the respondent’s contraventions of s 114A(3) of the TEQSA Act (as set out in the declaration at paragraph 1 above).

2. Within 30 days of the date of this order, the respondent pay the applicant’s costs of, and incidental to, this proceeding, fixed in the amount of $150,000.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

LENEHAN J:

INTRODUCTION

1 This proceeding concerns academic cheating services.

2 The growing availability of those services has been said to pose a “significant threat to the integrity and reputation of the global higher education sector, including Australia’s both domestically and internationally”: Explanatory Memorandum to the Tertiary Education Quality and Standards Agency Amendment (Prohibiting Academic Cheating Services) Bill 2019 (Cth) (EM) at 2. The associated consequences of that threat coming to pass are large. The resulting reputational harm was understood to potentially “significantly impact the national economy”: EM at 3. It was also noted that (EM at 3):

There are…significant public confidence and safety risks, should a graduate who does not have the required skills and knowledge…go on to a professional career in a position of public trust or assurance — for example in engineering, or the health professions.

3 In responding to that perceived mischief, Parliament did not seek to punish individual students, who remain subject to the academic disciplinary procedures of their educational institutions. Instead, it targeted those providing academic cheating services by enacting s 114A of the Tertiary Education Quality and Standards Agency Act 2011 (Cth) (TEQSA Act) — which I will discuss further below.

BACKGROUND

4 The respondent, Chegg, Inc. (Chegg), is a publicly listed company, headquartered and incorporated in the United States of America, and listed on the New York Stock Exchange. Chegg India Private Limited (Chegg India) is (ultimately) a wholly owned subsidiary of Chegg. Chegg India is headquartered and incorporated in India.

5 During the period relevant to this proceeding, that is from 1 November 2021 to 31 May 2022 (Relevant Period), Chegg offered online services to students in Australia through a paid monthly subscription called Chegg Study Help. Chegg Study Help included a service called Expert Q&A. During the Relevant Period, Expert Q&A enabled subscribing students to submit questions through a website (www.chegg.com/study/qa) (Chegg Website) in a range of subject areas. Solutions to the questions were prepared by subject experts engaged by Chegg India (Experts) and then published on the Chegg Website.

6 On 8 October 2024, the applicant, the Chief Executive Officer of the Tertiary Education Quality and Standards Agency (TEQSA), filed an originating application supported by a concise statement. An amended originating application and amended concise statement were filed on 1 September 2025. TEQSA alleged that Chegg engaged in conduct which contravened s 114A(3) of the TEQSA Act. The parties agreed to a resolution of the proceeding, including penalty, prior to the hearing. To that end, the parties:

(a) filed a statement of agreed facts and admissions dated 20 February 2026 (agreed facts), setting out the facts agreed between the parties pursuant to s 191 of the Evidence Act 1995 (Cth) and the admissions made by Chegg;

(b) filed joint submissions on relief dated 20 February 2026; and

(c) provided proposed consent orders (as an annexure to the agreed facts) as the means of resolving the proceeding.

7 By the agreed facts, Chegg admitted to three contraventions of s 114A(3) of the TEQSA Act. Each contravention related to students enrolled in courses of study at Monash University in Victoria, Australia. I have incorporated the agreed facts as an annexure to these reasons. I have also adopted the pseudonyms employed in the agreed facts.

8 By the proposed consent orders, the parties contend for the following relief:

(a) declarations of the admitted contraventions by Chegg pursuant to s 21 of the Federal Court of Australia Act 1976 (Cth) (FCA Act);

(b) pursuant to s 117 of the TEQSA Act and s 82(3) of the Regulatory Powers (Standard Provisions) Act 2014 (Cth) (Regulatory Powers Act), payment by Chegg of a pecuniary penalty in the total amount of $500,000 in respect of the contraventions the subject of the declarations; and

(c) a contribution by Chegg to TEQSA’s costs of, and incidental to, this proceeding in the fixed sum of $150,000.

9 This proceeding thus attracts the public policy considerations identified by the High Court in Commonwealth v Director, Fair Work Building Industry Inspectorate [2015] HCA 46; 258 CLR 482 (Agreed Penalties Case) where French CJ, Kiefel, Bell, Nettle and Gordon JJ observed at [58]:

Subject to the court being sufficiently persuaded of the accuracy of the parties’ agreement as to facts and consequences, and that the penalty which the parties propose is an appropriate remedy in the circumstances thus revealed, it is consistent with principle and … highly desirable in practice for the court to accept the parties’ proposal and therefore impose the proposed penalty.

(Emphasis in original, citation omitted.)

10 Immediately before that passage, their Honours noted that “in civil proceedings there is generally very considerable scope for the parties to agree on the facts and upon consequences”, and there “is also very considerable scope for them to agree upon the appropriate remedy and for the court to be persuaded that it is an appropriate remedy” (at [57]).

11 The parties having taken advantage of that latitude, my function is twofold: first, forming a view as to whether I am sufficiently persuaded of the accuracy of the parties’ agreement as to the relevant facts and consequences; and second, determining whether the penalty the parties propose is an appropriate remedy in all the circumstances: Australian Competition and Consumer Commission v Apple Pty Ltd (No 4) [2018] FCA 953 at 7. For the reasons set out below, I am satisfied of those two matters.

12 Finally, I am also persuaded that the declaratory relief proposed by the parties ought to be granted. I will explain my reasons for that conclusion at the end of these reasons.

THE SERVICES AND THE ROLE OF THE EXPERTS

13 Before dealing more specifically with the admitted contraventions, it is convenient to say something further about the Experts and the nature of the services they provided.

14 As I have noted above, during the Relevant Period, the Experts were individuals directly engaged by Chegg India, on behalf of Chegg, in order to perform services for the provision of the Expert Q&A service. Those services included, amongst other things:

(a) accessing a question submitted to Expert Q&A in Australia on the Chegg Website;

(b) preparing an answer to a question on the Chegg Website; and

(c) uploading the answer to the question on the Chegg Website, so the answer could be accessed, viewed and/or downloaded by both the subscriber who had originally submitted the question and other persons who had subscribed to Chegg Study Help.

15 During the Relevant Period, Chegg provided directions, instructions and training to the Experts, and monitored the work undertaken by them, in connection with the services outlined above. That included:

(a) providing training and Expert Q&A Guidelines to the Experts to look for indications that questions uploaded to Expert Q&A included assessment tasks, such as terms like “exam”, “test” or “quiz”; and

(b) directing the Experts not to “participate in aiding academic dishonesty” or to answer questions that contained “inappropriate content” such as exam questions.

16 Chegg also had other mechanisms in place to address academic integrity in the provision of those services, including in particular:

(a) requiring subscribers to accept the “Terms of Use”. The Terms of Use relevantly stated “you specifically agree not to use, claim or submit as your own any portion of the help materials”, and required students to agree to abide by Chegg’s “Honor Code”; and

(b) publishing an “Honor Code” on the Chegg Website. The Honor Code contained statements prohibiting the use of Chegg’s services for academic cheating. Subscribers were reminded of the Honor Code every time they submitted a question to Expert Q&A through the Chegg Website, and were issued a warning in the event of inappropriate use of Expert Q&A.

17 During the Relevant Period, if an Expert prepared and uploaded an answer to a question on the Chegg Website, Chegg maintained ownership of, and intellectual property rights over, the content of the answer.

SUMMARY OF THE CONTRAVENING CONDUCT

18 I will now address, in more detail, the conduct which was admitted to have contravened s 114A(3) of the TEQSA Act. This summary is taken from paragraphs [16]–[38] of the agreed facts.

Water Surface Profiles Assessment

19 In May 2022, Student A was enrolled in the unit “CIV2263 – Water Systems” at Monash.

20 On or about 29 April 2022, in the course of undertaking that unit, Student A was instructed by Monash to undertake an assessment task entitled “Assignment – Water Surface Profiles” (Water Surface Profiles Assessment).

21 The Water Surface Profiles Assessment was an assessment task, or a substantial part of an assessment task, that Student A was required to undertake personally.

22 On or around 1 May 2022, Student A uploaded a copy of the Water Surface Profiles Assessment to Expert Q&A on the Chegg Website.

23 On or around 1 or 2 May 2022, Expert A (who was engaged by Chegg India) accessed or viewed the Water Surface Profiles Assessment on the Chegg Website and then:

(a) prepared a handwritten answer to the Water Surface Profiles Assessment; and

(b) uploaded their handwritten answer to the Water Surface Profiles Assessment to the Chegg Website (Water Surface Profiles Answer).

24 The Water Surface Profiles Answer reflected a substantial part, or all, of the work which Student A was required to undertake personally in order to complete the Water Surface Profiles Assessment.

25 On or around 2 May 2022, Student A accessed or viewed the Water Surface Profiles Answer on the Chegg Website. On 20 May 2022, Student A submitted work to Monash in response to the Water Surface Profiles Assessment which reflected, in whole or in part, the Water Surface Profiles Answer, including identical errors.

26 In the course of Monash’s subsequent investigation into alleged academic misconduct, Student A admitted “I relied on Chegg to complete this assignment”.

Programming Assessment

27 In or around November 2021, Student B was enrolled in the unit “FIT1045 – Algorithms and Programming Fundamentals in Python” at Monash.

28 On or about 8 November 2021, in the course of undertaking that unit, Student B was instructed by Monash to undertake an assessment task entitled “Programming Assignment” (Programming Ass ignment). The Programming Assignment was split into two parts. Part 2 of the Programming Assignment included questions titled “Task A: Direct Ancestor (6 Marks)” (Task A) and “Task B: Cousin Degree (6 Marks)” (Task B) (together, Programming Assessment Task). The Programming Assessment Task was an assessment task, or a substantial part of an assessment task, that Student B was required to undertake personally.

29 On or about 11 and 12 January 2022, a subscriber to Chegg Study Help with access to Expert Q&A uploaded a copy of the Programming Assessment Task to Expert Q&A on the Chegg Website. There is nothing in the agreed facts to suggest that that subscriber was Student B. I have proceeded on the basis that it was a person other than Student B.

30 On or about 11 and 12 January 2022, two Experts, B1 and B2 (who were engaged by Chegg India), prepared, accessed or viewed the Programming Assessment Task on the Chegg Website and then:

(a) prepared typed answers to Task A and Task B of the Programming Assessment Task, respectively; and

(b) uploaded their typed answers to Task A and Task B of the Programming Assessment Task to the Chegg Website (Programming Answer).

31 The Programming Answer reflected a substantial part, or all, of the work which Student B was required to undertake personally in order to complete the Programming Assessment Task and/or the Programming Assignment.

32 In or around the period 11 to 14 January 2022, Student B accessed or viewed the Programming Answer on the Chegg Website. On or around 14 January 2022, Student B submitted work to Monash in response to the Programming Assignment and/or the Programming Assessment Task which reflected, in whole or in part, the Programming Answer.

Databases Exam

33 In or around November 2021, Student E was enrolled in the unit “FIT2094 – Databases” at Monash.

34 On or about 1 November 2021, in the course of undertaking that unit, Student E was instructed by Monash to undertake an assessment task, being an examination to be completed that day (Databases Assessment Task). The Databases Assessment Task was an assessment task, or a substantial part of an assessment task, that Student E was required to undertake personally.

35 On 1 November 2021, Student E uploaded screenshots of questions contained in the Databases Assessment Task to Expert Q&A on the Chegg Website.

36 On 1 November 2021, Expert E (who was engaged by Chegg India) accessed or viewed the Databases Assessment Task on the Chegg Website and then:

(a) prepared a handwritten and typed answer to the Databases Assessment Task; and

(b) uploaded the handwritten and typed answer to the Databases Assessment Task to the Chegg Website (Databases Answer).

37 The Databases Answer reflected a substantial part, or all, of the work which Student E was required to undertake personally in order to complete the Databases Assessment Task.

38 On 1 November 2021, Student E accessed or viewed the Databases Answer on the Chegg Website, and submitted work to Monash in response to the Databases Assessment Task which was wholly or substantially comprised of the Databases Answer.

39 In the course of Monash’s subsequent investigation into alleged academic misconduct, Student E admitted to cheating on the Databases Assessment Task, including by uploading the Databases Assessment Task to the Chegg Website and “by taking advantage of online tutors through Chegg” in responding to the Databases Assessment Task.

THE RELEVANT LEGISLATIVE PROVISIONS

40 Subsections 114A(3) and 114A(4) of the TEQSA Act are in the following terms.

114A Prohibition on providing etc. academic cheating services

…

Providing etc. an academic cheating service

(3) A person contravenes this subsection if the person provides, offers to provide or arranges for a third person to provide an academic cheating service to a student undertaking, with a higher education provider:

(a) an Australian course of study; or

(b) an overseas course of study provided at Australian premises.

Civil penalty: 500 penalty units.

Generally not necessary to prove provision etc. of an academic cheating service to a particular student

(4) In proceedings for a contravention of subsection (1) or (3), it is not necessary to prove that the person provided, offered to provide or arranged for a third person to provide an academic cheating service to a particular student.

41 Various terms in s 114A(3) are defined in s 5 of the TEQSA Act, including:

academic cheating service means the provision of work to or the undertaking of work for students, in circumstances where the work:

(a) is, or forms a substantial part of, an assessment task that students are required to personally undertake; or

(b) could reasonably be regarded as being, or forming a substantial part of, an assessment task that students are required to personally undertake.

Australian course of study means:

(a) a single course leading to an Australian higher education award; or

(b) a course recognised by the higher education provider at which the course is undertaken as a combined or double course leading to one or more Australian higher education awards.

Example: An example of a combined or double course covered by paragraph (b) is a course that leads to the Australian higher education awards of Bachelor of Arts and Bachelor of Laws.

higher education provider means:

(a) a constitutional corporation that offers or confers a regulated higher education award; or

(b) a corporation that:

(i) offers or confers a regulated higher education award; and

(ii) is established by or under a law of the Commonwealth or a Territory; or

(c) a person who offers or confers a regulated higher education award for the completion of a course of study provided wholly or partly in a Territory.

42 This Court is empowered by s 117 of the TEQSA Act to impose a pecuniary penalty in respect of contraventions of s 114A(3). Section 117 is relevantly in the following terms.

117 Civil penalty provisions

Enforceable civil penalty provisions

(1) Each civil penalty provision of this Act is enforceable under Part 4 of the Regulatory Powers Act.

Note: Part 4 of the Regulatory Powers Act allows a civil penalty provision to be enforced by obtaining an order for a person to pay a pecuniary penalty for the contravention of the provision.

Authorised applicant

(2) For the purposes of Part 4 of the Regulatory Powers Act:

(a) each of the following persons is an authorised applicant in relation to the civil penalty provisions of this Act (except a civil penalty provision of Part 5A):

(i) a Commissioner;

(ii) the Chief Executive Officer; and

(b) the Higher Education Tuition Protection Director is an authorised applicant in relation to the civil penalty provisions of Part 5A.

Note: For delegation by the Chief Executive Officer, see subsection 154 L(2).

Relevant court

(5) For the purposes of Part 4 of the Regulatory Powers Act, each of the following courts is a relevant court in relation to the civil penalty provisions of this Act:

(a) the Federal Court;

(b) the Federal Circuit and Family Court of Australia (Division 2).

Maximum penalties

(6) Despite subsection 82(5) of the Regulatory Powers Act, the pecuniary penalty in relation to a contravention of a civil penalty provision of this Act (except subsection 114A(3) or 114B(2)) must not be more than the applicable pecuniary penalty specified for the provision.

Note: If a court is satisfied that a body corporate has contravened subsection 114A(3) or 114B(2) of this Act (about academic cheating services), under subsection 82(5) of the Regulatory Powers Act the court may determine a pecuniary penalty not exceeding an amount equal to 5 times the pecuniary penalty specified for the civil penalty provision.

Extension to external Territories

(7) Part 4 of the Regulatory Powers Act, as that Part applies in relation to the civil penalty provision of this Act, extends to every external Territory.

43 That directs attention to Part 4 of the Regulatory Powers Act. Section 82, which appears in Part 4 of that enactment, relevantly provides:

82 Civil penalty orders

…

Court may order person to pay pecuniary penalty

(3) If the relevant court is satisfied that the person has contravened the civil penalty provision, the court may order the person to pay to the Commonwealth such pecuniary penalty for the contravention as the court determines to be appropriate.

Note: Subsection (5) sets out the maximum penalty that the court may order the person to pay.

…

(6) In determining the pecuniary penalty, the court must take into account all relevant matters, including:

(a) the nature and extent of the contravention; and

(b) the nature and extent of any loss or damage suffered because of the contravention; and

(c) the circumstances in which the contravention took place; and

(d) whether the person has previously been found by a court (including a court in a foreign country) to have engaged in any similar conduct.

CONSTRUCTION OF THE RELEVANT LEGISLATIVE PROVISIONS

44 The first issue I will deal with is whether I am sufficiently persuaded of the accuracy of the parties’ agreement as to the relevant facts and their consequences (being the agreed contraventions of s 114A(3) of the TEQSA Act). This issue, in turn, raises (novel) questions about the proper construction of s 114A(3) and its terms, some of which are the subject of further definition.

45 The principles of statutory construction are well established. As Gageler CJ, Gordon, Jagot and Beech-Jones JJ recently observed in Palmanova Pty Ltd v Commonwealth of Australia [2025] HCA 35; 99 ALJR 1362 at [4], the process of statutory construction begins and ends with the statutory text understood in context and in light of the statutory purpose — being what the provision is designed to achieve in fact — insofar as that purpose is discernible from the statutory text and context: see also Federal Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55; 250 CLR 503 at [39]; Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; 239 CLR 27 at [47]; NZYQ v Minister for Immigration, Citizenship and Multicultural Affairs [2023] HCA 37; 280 CLR 137 at [40]; YBFZ v Minister for Immigration, Citizenship and Multicultural Affairs [2024] HCA 40; 99 ALJR 1 at 12 [16]; 419 ALR 457 at 468.

46 Their Honours in Palmanova continued at [5]:

That being the nature of the task to which the process is directed, the “modern approach” to statutory construction, as was explained nearly 30 years ago in CIC Insurance Ltd v Bankstown Football Club Ltd in a statement repeated and endorsed many times since: “(a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses ‘context’ in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means ... , one may discern the statute was intended to remedy”. Use of extrinsic material in the construction of a provision of a Commonwealth statute is guided but not governed by a non-exhaustive list of categories of material statutorily recognised to have potential to illuminate the statutory context.

(Citations omitted.)

47 The parties relied upon a passage from SZTAL v Minister for Immigration and Border Protection [2017] HCA 34; 262 CLR 362 at [14], which is to similar effect.

48 The issue is how one applies those principles here.

The meaning of “work”

49 A person contravenes s 114A(3) of the TEQSA Act if a person provides, offers to provide or arranges for a third person to provide an “academic cheating service” to a student undertaking an Australian course of study or an overseas course of study in Australia, with a higher education provider. That provision then directs attention to the definition of an “academic cheating service” in s 5 of the TEQSA Act which is defined to mean “the provision of work to or the undertaking of work for students in [certain specified] circumstances” (emphasis added).

50 Relevantly, for present purposes, the term “work” is not defined in the TEQSA Act.

51 In this regard, it is well established that a court will not construe a provision in a way that departs from its natural and ordinary meaning unless it is plain that Parliament intended it to have some different meaning: Masons v Parsons [2019] HCA 21; 266 CLR 554 at 26. The parties appeared to submit (and I accept) that that approach is applicable here. However, the issue of how that was to be applied was put ambivalently: in essence, the parties submitted that, giving that term one of its ordinary meanings, “work” should be construed to mean either the (intellectual) labour or effort performed by a person or the result or product of that labour or effort.

52 I understood the parties to express some preference for the first ordinary meaning (that is, the labour or effort performed by a person). However, it was seemingly suggested by the parties that choosing between the proposed ordinary meanings might not ultimately matter because on either meaning of “work”, contraventions of s 114A(3) of the TEQSA Act are established.

53 The parties further submitted that whichever meaning is given to “work”, the relevant definition requires a sufficient connection between the work performed by the alleged service provider and the work that needed to be undertaken by a student to complete an assessment task, such that the person’s work can accurately be described as being or forming a substantial part of the assessment task. That last aspect of the agreed position is undoubtedly correct.

54 However, I do not propose to determine this proceeding on the basis of some diffuse understanding of the term “work”. For the following reasons, in my view, properly construed, the first proposed construction of that term is to be preferred: “work” is the intellectual labour performed by the relevant person.

55 First, that construction is strongly supported by the surrounding terms and concepts employed in the text of the definition. As I have said, and as the parties observed, the definition for “academic cheating service” refers to “the provision of work” or “the undertaking of work” (emphasis added). Those terms (particularly the notion of “undertaking” work) naturally point to the carrying out of an action, rather than to the products of such an action. The TEQSA Act contains other instances of such usage: see for example, “the undertaking of study” (s 44A(2)(a)); or “the undertaking of research” (s 44A(2)(b)).

56 This construction is reinforced by paragraphs (a) and (b) of the definition for “academic cheating service”, which qualify the words in the chapeau by reference to certain “circumstances”. Paragraph (a) refers to “circumstances where the work” “is, or forms a substantial part of, an assessment task that students are required to personally undertake ” (emphasis added). Meanwhile, paragraph (b) refers to “circumstances where the work” “could reasonably be regarded as being, or forming a substantial part of, an assessment task that students are required to personally undertake ” (emphasis added). The term “assessment task” is itself defined in section 5 (again in broad terms): it means “an assignment, essay, examination, practicum, presentation, project or any other assessable part of a course of study, whether mandatory or optional”.

57 Again, the notion of “undertak[ing]” such a “task” naturally suggests that the “work” referred to in the definition (for “academic cheating service”) is the carrying out of an action, rather than being limited to the products of such an action. As an aside, those further aspects of the design also seem to me to rebut any possible suggestion that the term is to be given a different meaning where it twice appears in the chapeau: Minister for Immigration, Citizenship, Migrant Services and Multicultural Affairs v Moorcroft [2021] HCA 19; 273 CLR 21 at 25; Registrar of Titles (WA) v Franzon [1975] HCA 41 at [8]-[10]; 132 CLR 611 at 618 (Mason J with whom Barwick CJ and Jacobs J agreed).

58 Second, that construction coheres with the statutory purposes of the TEQSA Act.

59 The extrinsic materials shed some light on those purposes and the correlative mischief. Relevantly, the EM observed that the Bill gave effect to certain recommendations of the Higher Education Standards Panel including that “the legislation focus on the conduct of those who provide cheating services…” (emphasis added): EM at 2.

60 It was further noted in the EM at 13 that:

Academic cheating services seriously undermine the integrity of the Australian higher education system and the consequences of students accessing these services can be severe. If a student graduates having relied on the assistance of a cheating service rather than personally achieving the required level of academic attainment, in fields such as medicine or engineering, the consequences can be life threatening …

(S ee also the similar observations I have extracted at [2 ] above.)

61 The concern with that legislative mischief found a specific textual foothold in the TEQSA Act, with the Bill adding to the objects clause a further sub-paragraph in the following terms: “to protect and enhance the academic integrity of courses provided by higher education providers by prohibiting academic cheating services”: see s 3(g) of the TEQSA Act and sch 1 item 1 of the Bill. That more specific object can be seen to be an aspect of the broader objects specified in s 3(c) of the TEQSA Act, namely, to protect and enhance Australia’s reputation for quality higher education and training services, Australia’s international competitiveness in the higher education sector, and excellence, diversity and innovation in higher education in Australia.

62 The point to be taken from all of that is that an overly narrow reading of the language used in the definition when read back into s 114A would deprive that section of much of its intended utility and fail to serve those statutory purposes (expressed at varying levels of specificity). In broadly expressed terms, Parliament sought to address certain conduct which was understood to have a corrosive effect on educational integrity. A narrower focus on the fruits of that conduct stands to lead to arid disputes about whether such conduct has or has not generated a particular product or result. That does not sit well with what the statutory text and context reveal about what the provision is designed to achieve in fact.

63 Putting those issues to one side, the construction of s 114A(3) is relatively straightforward for present purposes and I will shortly deal with its application to the current facts.

Subsection 114A(4) of the TEQSA Act

64 It is, however, necessary to note s 114A(4) of the TEQSA Act (also reproduced above). By reason of that provision, it is not necessary to establish that the person provided, offered to provide or arranged for a third person to provide an academic cheating service to a particular student. Accordingly, in the case of Student B, the fact that the Programming Answer was not provided by Experts B1 and B2 directly to Student B (because the Programming Assessment Task was not submitted on the Chegg Website by Student B but by another subscriber of Expert Q&A) is not determinative of the question of whether s 114A(3) has been contravened.

Agency

65 One other matter that requires some further explanation is the approach of the parties to Chegg’s involvement in the contravention. In this regard, the parties proceeded on the basis that s 114A(3) was contravened by Chegg via some form of agency relationship or, alternatively, by “arrang[ing]” for a third person to provide an academic cheating service.

66 As to agency, the parties essentially relied upon common law principles concerning an agency relationship: Commission v Bluescope Steel Ltd (No 5) [2022] FCA 1475 at 156; Australian Competition and Consumer Commission v Cornerstone Investment Aust Pty Ltd (in liq) (No 4) [2018] FCA 1408 at 303. It was (uncontroversially) submitted that an agency relationship requires that one party acts on the other’s behalf, but subject to that other’s control or direction: Australian Competition and Consumer Commission v Emma Sleep GmbH [2025] FCA 618 at 30.

67 If there is an agency relationship, the question that then arises is whether the principal is to be imputed with the agent’s conduct. The parties were agreed that I should approach that issue on the basis that an agent’s conduct ought to be attributed to the principal if it was undertaken within the scope of the agent’s actual or apparent authority. In Australian Competition and Consumer Commission v Productivity Partners Pty Limited (t/a Captain Cook College) (No 3) [2021] FCA 737;154 ACSR 472 at [115], Stewart J said the following with regard to the difference between actual and apparent authority which I gratefully adopt:

The difference between actual and apparent, or ostensible, authority is important. The actual authority of an agent can be express or implied. It is a question of the terms of a contract of agency between principal and agent, recognising that the conclusion as to the relationship of agency and its terms may be based on express terms and their construction or conduct and circumstances, or a combination. Ostensible authority, however, may exist where there is no actual authority, or it may co-exist with actual authority but not be co-extensive with it. This is described by Dal Pont in The Law of Agency (3rd ed., LexisNexis, 2013) as follows (omitting references):

[20.2] The doctrine of ostensible authority dictates that a principal may be liable under a contract effected by a person who lacks actual authority from the principal to effect the contract, but on whom the principal has, by his or her words or actions, conferred ‘apparent’ or ‘ostensible’ authority to do so. This liability may arise whether or not there is a pre-existing agency relationship; it is conceivable, although perhaps not common, that a person ‘holds out’ another person as having authority as agent even though no agency relationship exists between them. Were it not for such a doctrine, persons who bona fide deal with agents, or persons who profess to be agents, would ‘always be at peril if they were confined to having to discover and observe the actual authority of the agent and not be entitled to rely upon the agent’s ostensible authority’.

…

[20.5] There need not be any pre-existing agency relationship between A and B in order for A to confer ostensible authority on B to act on A’s behalf; there can be ostensible but no actual authority. The agency itself can be created by the principal’s ‘holding out’. Yet it is more common for there to be a pre-existing principal–agent relationship between A and B, the ostensible authority of B exceeding the actual authority conferred by A pursuant to the terms of the agency agreement. This is more common because it is easier to identify a representation or ‘holding out’ of a person’s authority if he or she is already an agent, albeit with a limited actual authority, of the representor than in the absence of such a pre-existing relationship.

68 I will explain how that analysis applies to the current proceeding below.

Conclusions as to contravention

69 Subject to the matters I have dealt with above, I am sufficiently persuaded of the accuracy of the parties’ agreement as to the relevant facts and their legal consequences. T he parties explained the manner in which those facts resulted in a contravention of s 114A(3) as follows:

(a) Each of the Water Surface Profiles Assessment Task, the Programming Assignment and the Databases Assessment Task was submitted on the Chegg Website.

(b) Experts A, B1 and B2, and E prepared and uploaded the Water Surface Profiles Answer, the Programming Answer and the Databases Answer on the Chegg Website.

(c) Each of the Water Surface Profiles Assessment Task, the Programming Assignment and the Databases Assessment Task was an “assessment task” within the meaning of the definition of that term in s 5 of the TEQSA Act. In that regard, the Water Surface Profiles Assessment Task was clearly marked as an “assignment”, while the Programming Assignment and the Databases Assessment Task contained allocations of marks.

(d) Each of the Water Surface Profiles Assessment Task, the Programming Assignment and the Databases Assessment Task was also an assessment task that students were required to personally undertake.

(e) The preparation and uploading of each of the Water Surface Profiles Answer, the Programming Answer and the Databases Answer constituted the provision of “work” to, or the undertaking of “work” for students which was, or formed a substantial part of, an assessment task.

(f) The intellectual labour expended by Experts A, B1, B2 and E in preparing those answers formed the whole or a substantial part of the work that was required to complete the assessment task or would have been regarded as such by a reasonable person in the position of each Expert.

(g) Each of Students A, B and E submitted their responses to the assessment tasks they had been instructed to complete with minimal, if any, substantive edits to the Water Surface Profiles Answer, the Programming Answer and the Databases Answer as uploaded to the Chegg Website by the Experts.

(h) As such, Chegg provided, or arranged for a third party to provide, an academic cheating service within the meaning of the TEQSA Act in one or both of the following ways.

(i) Chegg provided an academic cheating service because it performed work that Students A, B and E were personally required to undertake through its agents, Experts A, B1, B2 and E as follows.

(A) Experts A, B1, B2 and E were engaged by Chegg India on behalf of Chegg.

(B) Chegg provided directions, training and instructions to Experts A, B1, B2 and E and authorised them to provide answers to questions posted to the Chegg Website, over which it maintained intellectual property rights.

(C) In this way, the work provided by Experts A, B1, B2 and E – namely, the preparation and uploading of the Water Surface Profiles Answer, the Programming Answer and the Databases Answer, respectively – in the circumstances outlined in paragraphs (a) to (f) above was, in substance and effect, an academic cheating service provided by, and attributable to, Chegg.

(ii) And/or Chegg arranged for Experts A, B1, B2 and E, as third parties, to provide an academic cheating service through: its engagement via Chegg India of Experts A, B1, B2 and E to answer questions posted on the Chegg Website; and, its ongoing provision of directions, training and instructions to Experts A, B1, B2, and E, in the circumstances outlined in the agreed facts.

70 I should add that it was likewise uncontroversial between the parties that Monash is a “higher education provider” and that each course of study at Monash was an “Australian course of study” as those terms are defined in s 5 of the TEQSA Act. Having regard to those matters, I am sufficiently satisfied that each of the three instances involved a contravention of s 114A(3) of the TEQSA Act.

71 That, of course, rests in part upon the construction of “academic cheating service” I have adopted above. However, even if the term “work” was construed to mean the result or product of labour or effort, the parties agree that Chegg would, in any event, have contravened s 114A(3) of the TEQSA Act. And so, even if I am wrong as to my preferred construction, I would have been sufficiently persuaded of the parties’ agreement as to contraventions of s 114A(3) of the TEQSA Act on that basis. As to that issue, the parties agreed (in addition to the matters identified at [69 (a) ]-[69 (ii) ]) that the answers themselves formed the whole or a substantial part of the work that was required to complete the assessment task or would have been regarded as such by a reasonable person in the position of each Expert.

72 I turn then to the question of a penalty.

PENALTY

The relevant authorities with respect to the imposition of a civil penalty

73 The applicable principles regarding the imposition of civil penalties were uncontroversial as between the parties and may be summarised as follows.

74 Section 82(3) of the Regulatory Powers Act confers a discretionary power on a court. Like any such power so conferred, it is to be exercised judicially, that is, fairly and reasonably having regard to the subject matter, scope and purpose of the legislation: Australian Building and Construction Commissioner v Pattinson [2022] HCA 13; 274 CLR 450 at 40.

75 More specifically, that discretionary power enables the Court to impose an “appropriate” penalty in respect of a contravention of a civil remedy provision. The meaning of “appropriate” involves “[c]onsiderations of deterrence, and the protection of the public interest”, which may justify “the imposition of the maximum penalty where it is apparent that no lesser penalty will be an effective deterrent against further contraventions of a like kind”: Pattinson at 50.

76 Civil penalties are imposed primarily, if not solely, for the purpose of deterrence: Pattinson at 15. That is, the purpose of a civil penalty is primarily if not wholly protective in promoting the public interest in compliance: Agreed Penalties Case (2015) 258 CLR 482 at 55.

77 As such, a penalty satisfies the description “appropriate” if it is no more than what might be considered to be reasonably necessary to deter further contraventions of a like kind by the contravenor and others: Pattinson at 9.

78 The “contraventions of a like kind” from which those persons must be deterred are not limited to contraventions of the particular provision in issue: they rather extend to contraventions of laws of a similar kind to the contraventions admitted or proved in the particular case. The content of that concept also depends on the circumstances of the case, including the nature of the conduct comprising the contravention, the provision contravened, and the circumstances of the contravenor, including whether the contravening conduct is part of an unlawful strategy or plan and whether the contravention involved senior management: Construction, Forestry, Maritime, Mining and Energy Union v Fair Work Ombudsman [2023] FCA 72; 322 IR 233 at [103]-104.

79 In Trade Practices Commission v CSR Ltd [1990] FCA 521; ATPR 41-076 at [42], French J listed the following factors which informed the assessment under the Trade Practices Act 1974 (Cth) of a penalty of appropriate deterrent value:

(a) the nature and extent of the contravening conduct;

(b) the amount of loss or damage caused;

(c) the circumstances in which the conduct took place;

(d) the size and power of the contravenor;

(e) the deliberateness of the contravention and the period over which it extended;

(f) whether the contravention arose out of the conduct of senior management;

(g) whether the contravenor has a culture conducive to compliance, as evidenced by educational programs and disciplinary or other corrective measures in response to an acknowledged contravention; and

(h) whether the contravenor has shown a disposition to co-operate with the authorities responsible for the enforcement in relation to the contravention.

80 These factors, however, are not a “rigid catalogue of matters for attention” as if it were a legal checklist: Pattinson at 19. The Court’s task is to determine what is an “appropriate” penalty in the circumstances of the particular case.

81 I also note that some of those factors (or substantially similar matters) are now required to be taken into account as mandatory considerations by force of s 82(6) of the Regulatory Powers Act, which (in a non-exhaustive fashion) requires the Court to take into account “all relevant matters” “including”:

(a) the nature and extent of the contravention; and

(d) the nature and extent of any loss or damage suffered because of the contravention; and

(e) the circumstances in which the contravention took place; and

(f) whether the person has previously been found by a court (including a court in a foreign country) to have engaged in any similar conduct.

82 In NW Frozen Foods Pty Ltd v Australian Competition and Consumer Commission [1996] FCA 1134; 71 FCR 285 at 290-291 (Burchett and Kiefel JJ) and Minister for Industry, Tourism and Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72; ATPR 41-993 at 51, it was held that because the fixing of the quantum of a penalty cannot be an exact science, the Court does not ask whether it would without the aid of the parties have arrived at the precise figure they have proposed, but rather whether their proposal can be accepted as fixing an appropriate amount. Those observations were cited with apparent approval by the High Court in the Agreed Penalties Case (2015) 258 CLR 482 at [28]. By reason of those matters, there is a permissible range in which courts have acknowledged that a particular figure cannot necessarily be said to be more appropriate than another. However, the agreement of the parties cannot bind the Court to impose a penalty which it does not consider to be appropriate: Volkswagen Aktiengesellschaft v Australian Competition and Consumer Commission [2021] FCAFC 49; 284 FCR 24 at 125.

83 I have considered the penalty proposed by the parties with these principles in mind.

The circumstances of this case and the factors relevant to penalty

The statutory maximum

84 In respect of each contravention of s 114A(3) by Chegg in the period between 1 November 2021 to 31 May 2022, the maximum penalty was $555,000. In aggregate, the maximum penalty payable for three contraventions was $1,665,000. The proposed aggregate penalty of $500,000 is thus less than one third of the maximum aggregate penalty that might be imposed.

The nature and extent of the contraventions, and loss or damage suffered

85 As outlined above, the conduct relating to the contraventions concerned Chegg providing, or arranging for a third party to provide, an academic cheating service to students on three occasions during 2021 and 2022. Chegg’s contraventions resulted in Monash making findings of academic plagiarism against each of Students A, B and E.

86 The nature and extent of any loss or damage suffered is of primary importance in the assessment of an appropriate penalty. The parties’ joint submissions concerning the loss or damage suffered (and their agreement on those issues) were somewhat limited, but nevertheless sufficient for present purposes.

87 One aspect of the loss here is financial — by reason of the contraventions, Monash had to expend resources to monitor, detect and handle the academic cheating the subject of the contraventions. These include academic staff costs, professional staff costs, system administration costs, professional development costs and overhead and incidental costs. The parties have not sought to quantify those losses, presumably reflecting the difficulty in precisely allocating such expenses to the specific instances in issue here.

88 It seems likely, in the context of three specific instances, that (while undoubtedly of some substance) those financial losses are not extensive. However, the loss and damage to be considered by the Court is not limited to financial harm: Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Limited [2015] FCA 330; [2015] ATPR 42-494 at 57. Relevantly, in that regard, the parties agree that any contravention of s 114A(3) could undermine the objects of the TEQSA Act as set out in ss 3(c) and 3(g). The resulting harm is not precisely quantifiable in money terms, but it is undoubtedly significant.

89 I have also had some regard to the position of Students A, B and E. While by no means innocent parties, the findings of plagiarism which have resulted from Chegg’s contraventions will have a profound impact on those persons.

90 The parties also submitted, and I accept, that Chegg benefited from these contraventions in the sense that it obtained revenue from those students who subscribed to the Expert Q&A service. There was thus a correlative benefit associated with the harms that I have described.

91 The evidence does not disclose the precise amount of that benefit. In 2022, 8.1 million persons subscribed to Chegg’s services globally, including approximately 117,216 persons in Australia. The monthly cost of the subscription in Australia was approximately $14.29 to $28.55, depending on the subscription product chosen. Of course, not all of that revenue could be said to be derived from or associated with the three specific instances of contravening conduct here. But, as the facts surrounding Student B indicate, Chegg’s contravening conduct may have involved the receipt of revenue from students other than Students A, B and E.

Size and financial position of Chegg

92 As outlined above, Chegg is a large global organisation, listed on the New York Stock Exchange, and generates very substantial revenue. The pecuniary penalty required to achieve the objective of deterrence will generally be larger where the company has vast resources: Volkswagen (2021) 284 FCR 24 at 154. The revenue from Chegg in FY2022 was US$728,754,125.

93 However, because aspects of the relevant conduct occurred in Australia (albeit with a transnational dimension), it is, the parties agreed, also relevant to look at the revenue of Chegg’s Australian business, which is comparatively smaller. Although the parties did not rely upon it in their written submissions, that approach is supported by O’Bryan J’s reasoning in Australian Competition and Consumer Commission v Uber B.V. [2022] FCA 1466.

94 The revenue of Chegg in Australia in FY 2022 was US$8,823,213.

95 The parties submitted that it is also appropriate to consider the fact that Chegg’s revenue has since declined. In FY 2025, Chegg earned net revenue of approximately US$2,174,024 from business carried on in Australia and global net revenue of approximately US$330,149,227. Furthermore, Chegg’s subscriber numbers have declined from approximately 8.1 million globally in 2022 to approximately 2.87 million in 2025. Less than 1.5% of Chegg’s global subscribers in 2022 and 2025 were located in Australia. At present, that number is 33,140.

96 The financial metrics provided by the parties provide a useful benchmark when considering the amount of penalty to be imposed for each contravening act or omission. In particular, as O’Bryan J observed in Uber at [115], it can be helpful to compare the amount of penalty to be imposed for each contravening act or omission with the annual revenue, so as to assess whether the penalty may be regarded as a cost of doing business as opposed to a deterrent against future contraventions. The parties did not provide Chegg’s revenue figures in Australian dollars so as to enable any precise comparison of that nature. But it is readily apparent that the proposed penalties are significant when measured against Chegg’s Australian revenue in 2022 and 2025.

97 Using the helpful analysis proposed by O’Bryan J, the penalty can be seen to be a significant cost of doing business in Australia (particularly in terms of its current Australian revenue position), illustrating its utility as a deterrent. It is a penalty that will “sting” and thus deter: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2018] HCA 3; 262 CLR 157 at [116]-117.

Circumstances of the contraventions, including deliberateness and the role of senior management

98 The parties submitted that the three admitted contraventions arose by reason of Chegg failing to adequately implement its policies and procedures (as outlined above at [15 ]) designed to prevent academic cheating using the Expert Q&A service. More specifically, the parties contended that the compliance policies and processes were either not properly followed, or simply inadequate to prevent the Expert Q&A service from being used for academic cheating.

99 The parties also submitted that the fact there is no evidence before the Court that the conduct amounting to the contraventions was deliberate is relevant to the assessment of the appropriate penalty. In addition, the parties contended that the absence of evidence that any member of Chegg’s senior management team was involved in or had knowledge of the contraventions at the time they took place is an important circumstance in determining the penalty to be imposed.

100 I accept those submissions. I do, however, note that Chegg’s senior management team is now on notice that its earlier procedures have proved inadequate — either because they were not followed or because they were simply inherently flawed. I deal below with the steps that have been taken to remedy those issues. But as a general proposition (which may be relevant for any future contravention proceedings), those past failings might be expected to demand considerably closer vigilance on the part of Chegg’s senior management team in the future.

Compliance culture, including cooperation and prior conduct

101 I have already noted that Chegg had in place certain policies and procedures during the Relevant Period, one objective of which was to protect academic integrity and prevent the provision of services which would result in academic cheating. Clearly those measures have failed to achieve that objective in these instances.

102 The parties submitted that since May 2022, Chegg has taken steps to strengthen those measures, including:

(a) implementing regular Honor Code reminders for Australian subscribers and Experts;

(b) updating its mandatory Guidelines training for Experts; and

(c) appointing new advisors to its Academic Advisory Board.

103 The efficacy of those measures is unclear and the agreed facts do not deal with their likely effect. I must say that I have some concerns as to that issue in light of the unfortunate circumstances of this case and the failures of the existing measures deployed by Chegg. That is an issue which will require close vigilance on the part of Chegg’s senior management team. However, TEQSA did not appear to dispute that I may have regard to those matters as steps taken towards remedying the issues that have led to the admitted contraventions. I have, accordingly, taken those matters into account.

104 I have also had regard to the fact that Chegg exhibited what might be characterised as a moderate level of cooperation once Monash had detected suspected academic cheating.

105 I note, in that regard, that Chegg did not self-report any suspected contraventions of the TEQSA Act to TEQSA. The conduct which gave rise to the contraventions was rather reported to TEQSA by Monash.

106 Following requests by Monash, Chegg removed the Water Surface Profiles Assessment and Answer, the Programming Assessment Task and Answer and the Databases Assessment Task and Answer from the Chegg Website. Upon request, Chegg also provided Monash with details of subscriber(s) who had uploaded the relevant questions and viewed the relevant answers on the Chegg Website.

107 Chegg also agreed to a resolution of the matter, including a penalty, albeit after the commencement of proceedings. The parties submitted that by its cooperation, Chegg has spared the costs and resources that would otherwise have been incurred by TEQSA and the Court in a fully litigated dispute, and that this cooperation has been factored into the penalty figure agreed between the parties. I have had regard to each of those matters.

Previous contraventions (including any found by a court in a foreign country)

108 Chegg has not previously been found to have contravened the TEQSA Act.

109 In 2024, Chegg was a defendant in a securities class action in the United States District Court for the Northern District of California. In an interlocutory judgment on a motion by Chegg to dismiss the proceeding, a judge of that court determined that the evidence presented on the motion was capable of supporting findings that cheating was occurring on the Expert Q&A platform, and that Chegg knew about this. However, the proceeding was settled prior to hearing without admissions, and no findings were ultimately made as to Chegg’s conduct.

110 The parties submitted that this matter should be given little to no weight in determining the appropriate penalty in this case. I accept that little weight should be given to this matter.

Conclusion as to appropriate penalty

111 Chegg has engaged in three distinct contraventions of the TEQSA Act.

112 The parties jointly submitted that the Court should impose a total pecuniary penalty of $500,000 for the three contraventions. It was not suggested that I should approach that on the basis of the so-called “course of conduct principle”: Construction, Forestry, Mining and Energy Union v Cahill [2010] FCAFC 39; 194 IR 461 at [39] and 41. See also Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union [2017] FCAFC 113; 254 FCR 68 (ABCC v CFMEU) at [108]-115; Australian Competition and Consumer Commission v Cement Australia Pty Ltd [2017] FCAFC 159; 258 FCR 312 at 424. It was rather simply put that a penalty of $166,667.67 for each contravention reflected the appropriate penalty in each case.

113 I accept that those penalties (and an aggregate penalty of $500,000) for the three contraventions are within the range of penalties that could be considered appropriate in the circumstances of this case. The relevant factors in that assessment are:

(a) First, the contraventions involved three discrete instances of contravening conduct in 2021 and 2022.

(a) Second, although Chegg is a large global organisation, the size of its Australian business is much smaller, and its net revenue has declined and continues to decline.

(g) Third, Chegg’s senior management team were not involved in, nor did they have knowledge of, the contraventions at the time they took place.

(h) Fourth, related to that, there is no evidence before the Court that the conduct amounting to the contraventions was deliberate.

(i) Fifth, nevertheless, the contraventions did result from admitted failures by Chegg to implement adequate (or adequately implement) compliance policies and processes — although noting that Chegg did have such measures in place in an attempt to prevent academic cheating. It is important to send a message to Chegg and to others as to the need for greater vigilance to avoid such failings, which are ultimately failures of management at some level.

(j) Sixth, the contraventions resulted in modest financial loss or damage to Monash and also undermined the objects of the TESQA Act as set out in ss 3(c) and 3(g). Chegg also obtained some financial benefit from its contravening contact.

(k) S eventh, Chegg has not previously have been found to have contravened the TESQA Act. I have had regard to the interlocutory decision in the Californian proceeding discussed at [109 ], but given that little weight for the reasons I have identified above.

(l) Eigh th, Chegg exhibited a moderate level of cooperation with Monash and TESQA. Chegg failed to self-report the contravention to TESQA. However, once notified by Monash, Chegg complied with all relevant requests and eventually agreed to a resolution of the matter in this proceeding.

(b) Nin th, Chegg maintains internal policies and undertakes compliance training designed to make relevant employees aware of Chegg’s obligations under applicable statutory laws. In addition, Chegg has taken steps to strengthen its protections against the use of Expert Q&A for academic cheating in light of the contraventions. While I have some doubts as to the likely efficacy of those “strengthened” measures in and of themselves, it no doubt reflects some concrete recognition on the part of Chegg that the measures it has previously deployed to avoid contravention of the TEQSA Act are deficient or have been deployed in a deficient manner.

114 Having regard to these matters, I am satisfied that those penalties will achieve both specific and general deterrence. They are substantial penalties which will signal to both Chegg and to others the importance of compliance with the provisions of the TEQSA Act.

DECLARATORY RELIEF

115 The Court has a wide discretionary power to make declarations under s 21 of the FCA Act. As the majority observed in Ainsworth v Criminal Justice Commission [1992] HCA 10; 175 CLR 564 at 582 (Mason CJ, Dawson, Toohey and Gaudron JJ), because it is “confined by the considerations which mark out the boundaries of judicial power”, declaratory relief:

… must be directed to the determination of legal controversies and not to answering

abstract or hypothetical questions. The person seeking relief must have “a real

interest” and relief will not be granted if the question “is purely hypothetical”, if

relief is “claimed in relation to circumstances that [have] not occurred and might

never happen” or if “the Court’s declaration will produce no foreseeable

consequences for the parties”.

(Citations omitted.)

116 In ABCC v CFMEU (2017) 254 FCR 68, the Full Court observed at [90] that the fact that the parties have agreed that a declaration of contravention should be made does not relieve the Court of the obligation to satisfy itself that the making of the declaration is appropriate. Their Honours went on to state at [93] that:

Declarations relating to contraventions of legislative provisions are likely to be appropriate where they serve to record the Court’s disapproval of the contravening conduct, vindicate the regulator’s claim that the respondent contravened the provisions, assist the regulator to carry out its duties, and deter other persons from contravening the provisions...

(Citations omitted.)

117 Declarations are not made as a matter of course: Australian Competition and Consumer Commission v Energy Australia Pty Ltd [2015] FCA 274; ATPR 42-491 (ACCC v Energy Australia) at 83. Attention must be given to the form of the declaration so, at the very least, they are informative as to the basis on which the Court declares that a contravention has occurred and “should contain appropriate and adequate particulars of how and why the impugned conduct is a contravention of the Act”: ACCC v Energy Australia at [83].

118 I consider that the declarations proposed by the parties are in an appropriate form to be made by the Court. The contravening conduct is admitted. Those admissions provide a sufficient factual foundation for the making of the declarations: see Australian Competition and Consumer Commission v Coles Supermarkets Australia Pty Ltd [2014] FCA 1405 at 79. The proposed declarations are directed to conduct that contravenes the TEQSA Act and the matters in issue have been identified and particularised by the parties with precision. There can be no doubt that the declarations sought here are significant in recording the Court’s disapproval of the contravening conduct and deterring others from engaging in similar conduct.

CONCLUSION

119 I will impose a pecuniary penalty in the amount of $500,000. I will make declarations sought by the parties in the form proposed by the parties.

120 Chegg has agreed to pay a contribution to TEQSA’s costs of, and incidental to, this proceeding in the sum of $150,000. I will make an order for the payment of those costs in the terms agreed by the parties.

| I certify that the preceding one hundred and twenty (120) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Lenehan. |
Associate:

Dated: 27 March 2026

Annexure A — Statement of Agreed Facts and Admissions

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