Recently the Federal Court of Australia declared that Lorna Jane Pty Ltd (Lorna Jane) the women’s activewear retailer, had made false and misleading claims in the promotion of her activewear during the COVID outbreak of 2020, which was in breach of Australian Consumer law. The four categories of misleading and deceptive representations made in respect of the activewear were that the ‘LJ Shield’ killed or eliminated pathogens including COVID-19, that the activewear protected wearers against COVID-19, that they stopped the spread of COVID-19 and that Lorna Jane had a reasonable scientific or technological basis for making those representations.
The Federal Court found that Lorna Jane had sought to exploit the fear and concern of the public and that the marketing campaign that the activewear was effectively ‘a shield against COVID’ was ‘exploitative, predatory, and potentially dangerous.’
Lorna Jane’s penalty for the breach was $5 million and the company was ordered to refrain from making additional ‘anti-virus’ claims in connection with its activewear, unless it had a reasonable basis for doing so. It also was ordered to establish and maintain a three-year compliance program and to pay the ACCC’s legal costs of $370 000.
This case is a clear illustration of the very serious consequences of false advertising under Australian Consumer Law. The full judgement of the case can be found here.