Legal action had been taken by the AOC after the Olympic-themed drive was launched even though Telstra had ended its sponsorship with them last year.

It consisted of a series of television commercials showcasing a version of the Peter Allen song I go to Rio describing Telstra as “Official Technology Partner” of the Seven Network.

This was a "clear attempt to deceive Australians", the AOC claimed.

Telstra insisted the campaign originated from its partnership with the Seven Network.

Court Justice Michael Wigley dismissed the AOC case and ordered it to pay Telstra's legal costs.

“Our current advertising simply promotes that commercial arrangement and that Telstra customers get free access to premium content through the Seven app,” a spokesman fpr Telstra said.

“The AOC raised concerns with us and so we updated our advertising to include an explicit statement that Telstra is not an official sponsor of the Olympic Games, any Olympic Committees or teams.

“Telstra’s mobile customers will get free premium access to the ‘Olympics on 7’ app - a great way of showcasing this revolutionary development, which is designed to deliver maximum coverage of the Olympics to Australians on all platforms.”

The AOC criticised a "narrow application" of the law, and claimed the decision had gone against the interests of Australian teams.

"Disappointingly, the Court’s decision in this particular case has, on what the AOC considers to be a very narrow application of the law, gone against the interests of Australia's Olympic Teams," they said in a statement. 

"Despite finding that 'there could be no doubt that Telstra intended to, and may well have succeeded in capitalising or exploiting, in a marketing sense, the forthcoming Rio Olympic Games', the Court did not consider that Telstra's 'extensive marketing and advertising campaign which... is focused or themed around the forthcoming Rio Olympic Games' crossed the 'fine line' by contravening the law."

Telstra’s partnership with the AOC is now held by its rivals Optus, which signed a 10-year agreement last December.

In one of the AOC’s biggest-ever national sponsorship deals, the agreement saw Optus, the second largest company of its kind in Australia behind Telstra, become the official telecommunications partner of the Australian Olympic Team for the next three Summer and Winter Olympic and Paralympic Games through to 2026.

Australia’s delegations for the Summer and Winter Youth Olympic Games will also benefit from the sponsorship along with other teams the AOC prepares, such as that for the 2017 World Beach Games in San Diego.

The multi-year agreement gives Optus access to a sponsorship programme, including the partner recognition programme, Olympic themed promotions, branded merchandise, VIP events, Olympic Games tickets and hospitality and licensed product opportunities.