Lorna Jane fined $5 million for misleading COVID-19 marketing campaign

After misleading the public through their ‘antivirus activewear’ promotion, Lorna Jane has been ordered to pay $5million dollars by the Federal Court. Their “LJ Shield Activewear” was found by the Court to deceive the public into believing that its activewear “stopped the spread” against viruses “including COVID-19”.

Background

In July 2020, Lorna Jane claimed through its advertising campaign that their activewear line was sprayed with an ‘LJ Shield’ which protected from highly contagious diseases. The slogan “Cure for The Spread of COVID-19? Lorna Jane Thinks So”, appeared in-store, via various online platforms as well media releases.

Initial concerns surrounding the brands campaign were raised by the Therapeutic Good Administration, which fined Lorna Jane with three Infringement Notices worth almost $40,000. In response to this, Lorna Jane stated that their claims were backed by scientific verification and were not attempting to exploit customers through their advertising campaign.

In December 2020 the Australian Competition and Consumer Commission (ACCC) took Lorna Jane to court alleging the brand made false and misleading claims and the brand owner was aware and involved in the conduct. Lorna Jane business representatives in court admitted that there was no scientific verification that the LJ Shield protected against viruses including COVID-19.

ACCC Chair Rod Sims described such conduct as “particularly harmful” as “consumers cannot easily check or monitor the claims made.”

With such claims occurring at a time of grave uncertainty and fear surrounding the global pandemic, Lorna Jane’s false and misleading representations were described by the Federal Court judge as “predatory and exploitative”.

The Court also found that the false representation of having scientific basis for such claims were approved by Lorna Jane’s director and Chief Officer, Ms Lorna Jane Clarkson, who was an active participant in the construction of the deceitful marketing campaign. She was found to be involved with developing the wording and imagery for the campaign, as well as making personal statements in both media releases and an Instagram story.

Outcome

“The $5million in penalties imposed by the Court highlights the seriousness of Lorna Jane’s conduct”, Sims said.

The Court also ordered that the activewear brand be prohibited for a three-year period, from making “antivirus claims” unless statements are backed and verified by scientific or technological evidence. Lorna Jane is required to issue public corrective notices across all marketing campaign platforms, establish a consumer law compliance program and pay the ACCC’s costs.

Substantial penalties such as those opposed on Lorna Jane ensure that consumers are protected by false and misleading misrepresentation by large brands, which have the potential to profiteer from customers fear during a global health crisis.

Recent developments

Following the Federal Court’s ruling, Lorna Jane released a media statement on their website acknowledging that some representations made about the LJ shield in their marketing campaign were misleading. The company in their statement states that throughout the process they have cooperated with the ACCC as well as complying with its court order obligations.

Since the dispute Lorna Jane Pty Ltd has reviewed and modified the production and marketing areas of the company which now entail new managerial roles. To ensure a similar issue does not arise in the future, improvements have been made to the product testing regime which now involves improved supplier testing, in-house product testing as well as independent certification before purchase or use by Lorna Jane.

What this means for businesses

Substantial penalties such as those opposed on Lorna Jane Pty Ltd ensure that consumers are protected by false and misleading misrepresentation by large brands, which have the potential to profiteer from customers fear during a global health crisis.

It also serves as an important reminder to businesses to stringently comply with the ACL, as brands who knowingly engage in misleading and deceptive conduct will be brought to account for their actions with considerable penalties. Much like Lorna Jane, businesses should consider improving their supply testing regime to involve in-house product testing as product information provided by suppliers may not always be accurate.

Share
Email
Print

Get in touch

With us personally, it is just one more way we’re different.

Danielle Snell

CO-FOUNDER AND MANAGING PARTNER

.

Robert McGirr

CO-FOUNDER AND PARTNER

.

"

"We were forced to issue legal proceedings against the insurer for a number of reasons including disagreement about the amount of money that was required to be paid out under the policy to reinstate our home. I want to express our deepest heartfelt gratitude and appreciation for all Elit did for our family throughout this matter."

Insurance Policy Holder

Home owner

Thank you to Danielle and Mark and the Elit team for all their hard work in acting for myself and my family against a large international insurer following a fire sustained at our home. We were forced to issue legal proceedings against the insurer for a number of reasons including disagreement about the amount of money that was required to be paid out under the policy to reinstate our home. I want to express our deepest heartfelt gratitude and appreciation for all Elit did for our family throughout this matter.
The work of Danielle and Mark was professional, consistent and to the highest standard throughout this process. I was so impressed by each of the team. It wasn’t just their exceptional professional work that left the impression, but more importantly, their interactions as good, decent, kind individuals. Thank you Elit for captaining this litigation ship throughout the tiresome journey! We really appreciate everything you have done for us. I hope and pray that each one of you has a share in some of the comfort you have provided my family in your own lives.

"

"Being subject to malicious false statements was very stressful, as I have always conducted myself with professionalism and integrity.  As a result of the action taken by Robert McGirr & Elit Lawyers, the false statements were retracted, I received a formal apology and was paid my legal costs. "

Defamation

Plaintiff

I was engaged to appear on behalf of a resident at an aged care home in a proceeding before the Tasmanian Civil and Administrative Tribunal (TASCAT). A false and defamatory email was sent by a senior executive of the home about my conduct at the hearing to a number of third parties.

The false statements contained in that email were serious and damaging to my reputation, and included amongst other things, an imputation of criminality, which if proven to be true, could have resulted in a term of imprisonment. Being subject to malicious false statements was very stressful, as I have always conducted myself with professionalism and integrity. 

As a result of the action taken by Robert McGirr and Elit Lawyers, the false statements were retracted, I received a formal apology and was paid my legal costs. I could not have achieved this outcome without the assistance of Robert. I felt informed and comforted throughout the process and am very grateful for the early result that was achieved. 

"

"I was devastated when I learnt of a very serious defamatory publication made against me. I was so grateful to Danielle and the legal team who were able to obtain a pseudonym order in my favour so that I was able to advance defamation proceedings with anonymity."

Defamation

Plaintiff

I was devastated when I learnt of a very serious defamatory publication made against me.

I was concerned that bringing a Court proceeding would lead to widespread media reporting which would in turn repeat the allegations made against me and cause even more harm to my reputation because let’s face it – mud sticks.

I was so grateful to Danielle and the legal team who were able to obtain a pseudonym order in my favour so that I was able to advance defamation proceedings against the publishers with anonymity and be comforted that the defamatory content linked to my name would not be further spread.

I felt vindicated at the end of the matter and will always look back on the experience as a difficult one but knowing that issuing the court proceedings was what I had to do in order to achieve redress and restore my reputation.

"

"When we were targeted by a vexatious and unfounded online attack, I turned to Robert, Danielle, and Elit for advice. As I am a lawyer myself, Elit’s ability to zone in so quickly on what was best for us really impressed me. "

Defamation

Lawyer and Business Owner

As a lawyer and business owner, I take our professional reputation seriously.

When we were targeted by a vexatious and unfounded online attack, I turned to Robert, Danielle, and Elit for advice. Their calm, clear, and strategic guidance was exactly what we needed. They quickly understood the key issues and provided practical options that prioritised our values and professional standing.

I was impressed with their ability to get across the key issues and provide real life practical advice during this critical time which really centred around us and what was best for our business.

As I am a lawyer myself, Elit’s ability to zone in so quickly on what was best for us really impressed me.

"

"My business was sued for defamation. The Eit team were able to pinpoint the weaknesses in the other side’s case and were able to resolve the proceeding on very favourable terms for us."

CEO

Medical Industry

My business was sued for defamation and my insurance company appointed Aggie, Danielle, Robert and the Elit team to act in my defence of the proceeding.

I was astounded by the fact that the Eit team were able to pinpoint the weaknesses in the other side’s case and after bringing an interlocutory application on my behalf, they were able to resolve the proceeding on very favourable terms for us.

I felt informed and comforted throughout the process and am very grateful for the early result that was achieved.

"

"I felt comforted and informed throughout the legal process and was happy with the early resolution of the case which achieved my ultimate objectives."

Director

ASX Listed Company

Danielle and team acted on behalf of myself and my fellow directors of an ASX listed company in the Supreme Court of Western Australia involving repeated attacks and defamatory content being posted about us on a forum website. The third party website operator was also joined to the proceeding.

Given the personal attacks made against me and my fellow directors, it was a difficult situation over an extended period and I felt comforted and informed throughout the legal process and was happy with the early resolution of the case which achieved my ultimate objectives to have the content removed and undertakings that no future defamatory content would be published by the person involved.

Can't find what you're looking for?

Search