Coverage for unclean hands? Plaintiffs Say Manufacturer Misrepresented Sanitizer’s Effect on Coronavirus


By: Renata Hoddinott and Barry Miller

On March 23 FMG presented the webinar Navigating Coverage Issues Arising from COVID-19. Presenters Marc Shrake, Erin Lamb, and Barry Miller discussed four lawsuits that already have been filed alleging claims related to coronavirus.
A few additional cases bear mentioning, and there will be many more to come.
In class action David v. Vi-Jon, Inc.¸ 20-CV0424, S.D. Cal. March 5, 2020 , a putative class alleges that Germ-X, a Vi-Jon product, is “advertised, marketed and sold as a Product that will prevent or reduce infection from the flu and other viruses, including the coronavirus.”
The David Complaint notes that on January 17, 2020, the Food and Drug Administration issued a warning letter to Purell regarding advertising that its hand sanitizer could prevent infection from flu and other viruses. The FDA letter says nothing about coronavirus, which given its date is not surprising. But it does chastise the maker of Purell for its advertising and social media posts that “clearly indicate your suggestion that PURELL® Healthcare Advanced Hand Sanitizers are intended for reducing or preventing disease from the Ebola virus, norovirus, and influenza.” Because Germ-X’s formula is nearly identical to Purell, the David Complaint states that the FDA letter applies equally to Vi-Jon.
Vi-Jon was already the subject of a class action suit filed a month earlier alleging similar promises that its product would prevent the transmission of flu also were misleading. The putative class in Sibley et al v. Vi-Jon, Inc., Case No. 20-cv951, N.D. Cal., February 7, 2020 also alleges the FDA letter to Purell should apply to Vi-Jon.
David alleges (¶ 50) that—by stating that Germ-X kills 99.9 percent of germs—Vi-Jon implies that Germ-X kills 99.9 percent of viruses and bacteria, preventing and reducing illness. Sibley, in turn, alleges that consumers were misled about the effectiveness of alcohol-based hand sanitizer and that Vi-Jon duped consumers into thinking their product (Germ-X) would fight the flu virus despite no clinical studies showing alcohol-based sanitizers reducing instances of the flu. Similarly, the January 17 FDA letter states that the agency “is currently not aware of any adequate and well-controlled studies demonstrating that killing or decreasing the number of bacteria or viruses on the skin by a certain magnitude produces a corresponding clinical reduction in infection or disease caused by such bacteria or virus.”
Both lawsuits allege claims under California consumer protection laws prohibiting false advertising and unfair competition. The David lawsuit adds common law claims for negligent misrepresentation and intentional misrepresentation.
False advertising may raise issues under Coverage B (“Personal and Advertising Injury”) under the standard Commercial General Liability Policy. Under the CGL definitions “Personal and Advertising Injury” only occurs if an enumerated “offense” is alleged or proved. In the ISO form those offenses are:

  • False arrest, detention or imprisonment;
  • Malicious prosecution;
  • The wrongful eviction from, wrongful entry into, or invasion of the right of private occupancy of a  room,  dwelling  or  premises  that  a  person occupies,  committed  by  or  on  behalf  of  its owner, landlord or lessor;
  • Oral or  written  publication,  in  any  manner, of material  that  slanders  or  libels  a  person  or organization   or   disparages a person’s  or organization’s goods, products or services;
  • Oral or  written  publication, in any manner, of material that violates a person’s right of privacy;
  • The use  of  another’s  advertising  idea  in  your “advertisement”; or
  • Infringing upon another’s copyright, trade dress or slogan in your “advertisement”.

None of these enumerated offenses expressly include false advertising or misrepresentations to consumers.
Coverage A is triggered by allegations of “Bodily Injury” to a third person or “Property Damage” suffered by a third person. The Complaints do not appear to allege bodily injury. In fact, the only specific damage claimed is that the class would not have bought Germ-X but for the advertising or representations of Vi-Jon. Thus, they allege, Vi-Jon holds money that should belong to the class. But the taking of money without right does not constitute “property damage” in many states, including California.
Another case worth reading is Welch Foods, Inc. v. Nat’l Union Fire Ins. Co., No. 09-12087-RWZ, 2010 U.S. Dist. LEXIS 110004 (D. Mass. Oct. 1, 2010) where a competitor alleged that Welch’s pomegranate juice was made mostly from apples. The court found no coverage for false and misleading advertising under three different policies and four different coverages:

  • There was no coverage under the GL for advertising injury.
  • A “Media Wrongful Act” coverage did not apply because (among other reasons) it covered “errors or omissions” in publications or broadcasts, and the complaint alleged intentionally false advertising.
  • “Professional Services Wrongful Act” coverage did not apply because there were no allegations that the advertiser was engaged in professional services, or that such coverage applies to claims from competitors.
  • A policy providing coverage for claims arising from an alleged “Wrongful Act” defined wrongful act to include a “misleading statement.” While the allegations may have fallen within that insuring agreement, the policy contained an exclusion for claims arising out of unfair competition or deceptive trade practices, among other business practices. Because the Complaint alleged such practices the exclusion applied.

Both Germ-X lawsuits, as well as any further actions that may be filed in the coming weeks and months, merit continued monitoring to see if coverage issues arise under these kinds of policies or others.
Additional information: 
The FMG Coronavirus Task Team will be conducting a series of webinars on Coronavirus issues every day for the next week. We will discuss the impact of Coronavirus for companies in general, but also for business in insurance, healthcare, California specific issues, cybersecurity, and tort. Click here to register.
FMG has formed a Coronavirus Task Force to provide up-to-the-minute information, strategic advice, and practical solutions for our clients. Our group is an interdisciplinary team of attorneys who can address the multitude of legal issues arising out of the Coronavirus pandemic, including issues related to Healthcare, Product Liability, Tort Liability, Data Privacy, and Cyber and Local Governments. For more information about the Task Force, click here.
You can also contact your FMG relationship partner or email the team with any questions at
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