Lululemon Sued Over See-Through Yoga Pants

×


Lululemon (LULU) may be eager to put its see-through yoga pants kerfuffle behind it, but shareholders who lost money as a result of the scandal aren't so eager to forgive and forget.

Reuters reports that a shareholders lawsuit filed today in the US District court in Manhattan accuses Lululemon of hiding defects in its yoga pants that ultimately resulted in a recall and an embarrassing string of headlines. A line of black yoga pants using the company proprietary Luon material was found to be too sheer, making the pants partially see-through in certain conditions.
The product recall is widely seen as a contributing factor in the departure of Christine Day, the long-time CEO who presided over a period of incredible growth for the athletic apparel retailer. The announcement of Day's ouster has tanked the share price more than the see-through pants ever did, and the lawsuit further charges the retailer of concealing talks of her imminent departure.

The lawsuit was filed by Massachusetts resident Houssam Alkhoury, a Massachusetts resident who bought 7,500 shares of the company. Those shares would have lost more than $100,000 in value immediately following Day's announcement that she would be leaving the company.

Matt Brownell is the consumer and retail reporter for DailyFinance. You can reach him at Matt.Brownell@teamaol.com, and follow him on Twitter at @Brownellorama.

Increase your money and finance knowledge from home

Building Credit from Scratch

Start building credit...now.

View Course »

Goal Setting

Want to succeed? Then you need goals!

View Course »

Add a Comment

*0 / 3000 Character Maximum

3 Comments

Filter by:
Mark

See thru yoga pants?? I would think the stock price would go UP!

July 03 2013 at 2:29 PM Report abuse rate up rate down Reply
movies

Hmmm backlash because of pants if you try on something that is so tight it becomes transparent either you are trying to get attention or you are to dam fat to put them on in the first place. Spandex ladies is a privelidge not a right.

July 03 2013 at 12:26 PM Report abuse +1 rate up rate down Reply
f1v79

Isn't the stock market supposed to be a risk?

July 03 2013 at 10:26 AM Report abuse +1 rate up rate down Reply