Lululemon's $2 Billion Yoga Pant Lawsuit Has Been Dismissed By a Judge
Looks like the embattled athletic wear brand we all can't decide if we love or hate finally caught a break this week. The Guardian reports that U.S. district judge Katherine Forrest has officially dismissed the last of three lawsuits related to the 2013 recall of Lululemon's see-through yoga pants. The lawsuit accused the brand of defrauding shareholders by not being… ahem… transparent regarding defects in the pants.
Company shareholders claimed that in 2013, Lululemon and its executives purposely concealed the severity of the black Luon yoga pant defect, which lead to the recall and major shareholder losses — $2 billion of 'em. Lawsuits also claimed that that company executives hid high-level leadership decisions and overstated quality control measures employed to avoid, for example, international shipments of see-through yoga pants.
Judge Forrest made the ruling that the plaintiffs' "narrative requires the court to stretch allegations of, at most, corporate mismanagement into actionable federal securities fraud." Essentially, doing a few stupid things that cost billions of dollars does not amount to illegal action, so stop whining. Alright, then.
Now that the lawsuits are over, Lululemon can shift attention to other issues, including cleaning up after their last CEO and worrying about a new competitor making its way into their market. Never a dull moment.