K-mart Australia sells used phones as new with PORN on them!!!

A few days ago a bought a 'brand new' phone from a K-mart store for my young daughter. It was plastic wrapped to give the appearance of it being new and unopened. When I opened it up I noticed that the security seal had been broken and the phone, battery and charger were not wrapped in plastic as they usually are.
When my daughter turned on the phone she was shocked to see a pornographic image as the screen saver. I have contacted K-mart and they are ignoring me hoping I'll go away.
Anyone have any advice on what I should do?