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| Women wearing Lululemon pants |
(Scroll down for video) A popular athletic clothing maker was hit with a lawsuit after lying about pants that were subject of a recall, according to a new lawsuit filed in court.
Lululemon Athletica Inc. has been hit with a lawsuit in the U.S. The lawsuit accused the company of defrauding shareholders by concealing defects in its yoga pants whose verticality led to a costly recall, and for concealing negotiations that led to the sudden departure of its chief executive officer.
The lawsuit in U.S. District Court in Manhattan was filed by a shareholder on Tuesday, three weeks after Lululemon CEO Christine Day announced her surprise departure after more than five years with the company.
Day resigned three months after the sportswear retailer told women that its popular pants was see through.
The company said that the recall of the pants may reduce profits this year by up to $40 million.
Lululemon has long been known for clothing that could withstand many years of use and washings.Mobile video not loading? Click here to view