What you need to know:

• Clothing company Lorna Jane will pay $5 million in penalties for falsely claiming its activewear would kill viruses.
• The ACCC took action against Lorna Jane in December, after investigating claims made in stores, in emails, in media releases and on its website.
• The court found Lorna Jane Clarkson, the company’s Chief Creative Officer, was personally involved in developing the campaign.

Fitness clothing brand Lorna Jane has apologised and been fined $5 million for claiming its LJ Shield Activewear “eliminated”, “stopped the spread” and “protected wearers” against viruses, including Covid-19.

The Australian Competition and Consumer Commission (ACCC) took legal action against the company after it made the “false and misleading” claims to customers between 2 and 23 July 2020.

Directed by the company’s director and Chief Creative Officer, Lorna Jane Clarkson, Lorna Jane claimed in marketing material that LJ SHIELD was a “groundbreaking technology that makes transferal of all pathogens to your Activewear… impossible by eliminating the virus on contact with the fabric”. It promoted the product on in-store signs, its website, on Instagram, in media releases, and in emails to customers.

The ACCC took Lorna Jane Pty Ltd to a Federal Court over the claims.

“The whole marketing campaign was based upon consumers’ desire for greater protection against the global pandemic,” ACCC Chair Rod Sims said in a statement.

“The $5 million in penalties imposed by the Court highlights the seriousness of Lorna Jane’s conduct, which the judge called ‘exploitative, predatory and potentially dangerous’.”

In the court case, Lorna Jane admitted it had falsely represented it had a scientific or technological basis for making the claims. The ACCC said the company admitted it did not have any scientific testing results showing the effectiveness of LJ Shield Activewear on viruses, including Covid, nor did it have any scientific results or evidence that could demonstrate the claims were true.

The court also found Ms Clarkson was directly involved in crafting the words and imagery used in the marketing campaign. The ACCC noted Ms Clarkson cooperated with the investigators, made admissions and agreed to make submissions regarding the penalties.  

“This was dreadful conduct as it involved making serious claims regarding public health when there was no basis for them,” Mr Sims said.

“This type of conduct is particularly harmful where, as here, consumers cannot easily check or monitor the claims made.”

"A trusted supplier sold us a product that did not perform as promised"

In a statement responding to the penalties, Lorna Jane said it "apologise[d] wholeheartedly" to customers and that it had believed the clothing had anti-viral abilities. It also pointed out it had sold the anti-viral clothing "at no extra cost" to customers. 

"A trusted supplier sold us a product that did not perform as promised. They led us to believe the technology behind LJ Shield was being sold elsewhere in Australia, the USA, China, and Taiwan and that it was both anti-bacterial and anti-viral," Bill Clarkson, Lorna Jane CEO, said. 

“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.”

Mr Clarkson said the company had spent the past 12 months reviewing the fundamentals of production and marketing, created new management roles in both teams and have introduced an "improved product testing regime" to prevent this from happening again. 

This matter has changed the way we are doing things in our business. We are putting in place the processes and governance measures a business our size needs. We are committed to continue to provide great products for our customers.

Ms Clarkson said she was "saddened" by what had happened. 

“I sincerely apologise to our customers. The company was let down by its supplier and I feel that I was let down personally by people I trusted," she 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.” 

Lorna Jane has 108 stores in Australia, as well as some in the US and New Zealand.