The Federal Court of Australia has ordered women’s activewear brand Lorna Jane to pay $5 million Australian dollars ($3.7 million) in fines for making “false and misleading representations to customers” regarding its products’ abilities to prevent wearers from contracting the coronavirus.
Lorna Jane has accepted the court’s ruling, maintaining that it was misled by a supplier.
In December, the Australian Competition and Consumer Commission (ACCC) sued Lorna Jane Pty Ltd for alleged false and misleading claims and filed litigation against the brand’s founder and chief creative officer, fashion designer Lorna Jane Clarkson, for allegedly being knowingly involved in the conduct. The allegations made against Clarkson have been dismissed.
As Covid-19 concerns swept the planet and lockdowns were put into effect worldwide, Lorna Jane claimed that the substance it marketed as “Lorna Jane Shield” when sprayed on its activewear fabric would eliminate viruses including Covid-19 upon contact. Therefore, activewear with the substance would protect the wearer from contracting or spreading Covid-19, the company claimed.
“Lorna Jane falsely promoted its LJ Shield Activewear as eliminating or providing protection from Covid amidst growing numbers of Covid-19 cases in Australia,” ACCC chair Rod Sims said in a statement. “The whole marketing campaign was based upon consumers’ desire for greater protection against the global pandemic.”
Lorna Jane, which has 134 stores across Australia, New Zealand, the U.S. and Singapore, described the technology as “groundbreaking” in its and could make pathogen transferal to the garment “impossible,” eliminating viruses on contact.
Additionally, advertisements on the brand’s website, stores, email campaigns and Instagram used the tag “Cure for the Spread of Covid-19? Lorna Jane Thinks So.” The ads lasted from July 2-23, 2020, before the brand removed all marketing material and initiated an immediate review of its processes.
In the decision, Justice Darryl Rangiah ordered Lorna Jane to also pay the ACCC’s litigation costs and to put a “corrective notice” on its website, social media, customer emails and in stores about the LJ Shield false claims. The court also ordered by consent that for a period of three years, Lorna Jane is restrained from making any “anti-virus” claims regarding its activewear clothing unless it has a reasonable basis for doing so and must establish a consumer law compliance program.
Rangiah didn’t hold back in his decision, slamming the brand’s conduct as “exploitative, predatory and potentially dangerous.”
As part of the decision, Lorna Jane admitted that it did not have any scientific testing results showing the effectiveness of LJ Shield Activewear on viruses, including Covid-19, nor did it have any scientific results or evidence that could verify its claims.
The brand admitted that Clarkson authorized and approved the LJ Shield Activewear promotional material, was involved in crafting the words and developing the imagery used in the marketing campaign, and personally made some of the false statements contained in a media release and an Instagram video. However, the brand upheld that Clarkson did not know that any information was misleading.
“This was dreadful conduct as it involved making serious claims regarding public health when there was no basis for them,” Sims said. “This type of conduct is particularly harmful where, as here, consumers cannot easily check or monitor the claims made.”
Before the start of a hearing on liability, Lorna Jane fully cooperated with the ACCC, admitting and agreeing to make joint submissions regarding penalties totaling $5 million.
Lorna Jane apologizes, shifts blame to supplier
In an apology to customers posted on its website, Lorna Jane said it accepted the Federal Court’s ruling, acknowledging that “some representations made to customers in the marketing of the LJ Shield product were misleading.”
CEO Bill Clarkson, Lorna Jane’s husband, wouldn’t go so far as to take full responsibility, saying in a statement that the brand had been “let down” by a trusted supplier.
“A trusted supplier sold us a product that did not perform as promised,” Clarkson said. “They led us to believe the technology behind LJ Shield was being sold elsewhere in Australia, the U.S., China and Taiwan and that it was both anti-bacterial and anti-viral. We believed we were passing on a benefit to our customers at no extra cost to them. We did not increase the retail price of the product.”
Clarkson said the company has reviewed the fundamentals of its marketing and production departments over the past 12 months, created new management roles in both teams and now introduced “improved” product testing to prevent similar occurrences in the future.
The product testing regime involves improved supplier testing and independent certification before purchase or use by Lorna Jane Pty Ltd.
The brand’s namesake and chief creative officer also apologized in the statement, echoing the sentiments that her company was disappointed by its supplier.
“I feel that I was let down personally by people I trusted,” Lorna Jane Clarkson said. “I have spent 35 years building a business that supports and empowers women—I would never intentionally put that at risk. I am committed to being better and doing better for all the women who love and support our brand.”
The watchdog’s suit came well after another Australian government agency, the Therapeutic Goods Administration (TGA), issued three infringement notices in July 2020 to Lorna Jane in connection with its marketing campaign, with penalties totaling $39,960 Australian dollars (approximately $29,300).
The TGA’s infringement notices highlighted Lorna Jane’s failure to register goods on the Australian register of therapeutic goods; a breach of the advertising code; and Lorna Jane’s failure to seek TGA approval prior to making certain claims.