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Gildan products.
Gildan products.

Gildan settles shareholder lawsuits Add to ...

Gildan Activewear denies any wrongdoing but has agreed to pay $22.5-million (U.S.) of court costs to settle class-action cases filed in Ontario, Quebec and New York.

The Montreal-based clothing maker said the payment will be totally covered by its insurance and will have no impact on its earnings or cash flow.

The lawsuits were filed in 2008 in Ontario, Quebec and New York.

The financial settlement will be distributed to eligible class members, net of court approved expenses and attorneys' fees.

"The settlement agreement acknowledges that the company and its senior officers deny all of the claims and charges of wrongdoing, liability or violation of laws," Gildan said in a news release.

The company noted that the settlement is subject to court approval. Gildan can terminate the proposed agreement if the number of shareholders who opt out and continue to pursue litigation exceeds a pre-determined threshold.

The class-action lawsuits alleged that executives pocketed millions of dollars by selling shares before news of problems at the company's Dominican Republic plant sent the stock plummeting.

Gildan is a leading supplier of T-shirts, sport shirts, underwear and socks manufactured primarily out of facilities in Central America and the Caribbean.

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