And now for an update on your favorite exorbipants yoga label, or otherwise, yoga biz news we’d rather not hear about. Lululemon is not out of the proverbial see-through woods yet. The brand is being sued by the Louisiana Sheriffs’ Pension & Relief Fund. Why? Because they owned about $1.3 million of Lululemon stock when all hell and private parts broke loose earlier this year.
In March Lulu recalled their groove pants for being too sheer, blaming it on defective production. But shareholders called bullshit and accused the lus of secret cost-cutting, claiming CEO Christine Day and Chairman Dennis “Chip” Wilson fraudulently hid the defects, used deep discounting to increase market share, and covered up plans to replace Day who surprise announced her resignation on June 10.
The lawsuit against Lulu is actually two combined (one from another shareholder) and is set for class-action status which means other pissed off folks may join in, like the Hallandale Beach Police Officers and Firefighters’ Personnel Retirement. The Louisana-based fund said it lost $116,000 between March 21 and June 10. However, this amount somewhat pales in comparison to the 17.5 percent drop in shares and $1.62 billion loss in market value after Day announced her departure. Deepening the dent is the dismal forecast for the rest of 2013 announced September 12. But they’re still making a bazillion dollars, lest we feel sorry for the company.
Meanwhile, Christine Day is still looking for her successor. We guess your applications didn’t cut it.
image via peerfit.com