The original complaint charges Gildan and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Gildan supplies activewear for the wholesale imprinted sportswear market in the United States and Canada, as well as in Europe. The Company sells T-shirts, sport shirts, and fleece in large quantities to wholesale distributors as undecorated blanks, which are subsequently decorated by screenprinters with designs and logos. The complaint alleges that, during the Class Period, defendants issued a series of materially false and misleading statements concerning the Company's financial performance and prospects. Specifically, the complaint alleges that these statements were materially false and misleading because defendants failed to disclose and/or misrepresented: (i) that sales of Gildan's activewear were performing below internal expectations as a result of a shortfall in production from its Dominican Republic textile facility; (ii) that Gildan was failing to timely write down an impairment in the value of its inventories, thereby materially overstating its financial results; and (iii) as a result of the foregoing, defendants had no reasonable basis for their earnings guidance for fiscal 2008 and other positive statements about the Company and its business. Then, on April 29, 2008, Gildan issued a press release announcing that it was reducing its earnings per share guidance for the second quarter and full year of fiscal 2008. Upon this news, shares of the Company's stock fell $10.99 per share, or 30%, to close at $24.93 per share, on heavy trading volume.
On September 16, 2008, the Court consolidated several related class actions, appointed the Institutional Investor Group as lead plaintiff and approved Labaton Sucharow LLC and Coughlin Stoia Geller Rudman & Robbins LLP as lead counsel. On November 17, 2008, the lead plaintiff filed a Consolidated Amended Class Action Complaint. The defendants responded by filing a motion to dismiss on December 19, 2008.
On July 01, 2009, the Plaintiffs' Defendants' motion to dismiss was granted. Subsequently, the court issued a judgment dismissing the case with prejudice on July 02, 2009.
On December 04, 2009, the Plaintiffs' motion for reconsideration was denied.
On May 11, 2010, the parties in the case have filed a stipulation withdrawing this appeal pursuant to Local Rule 42.1. This appeal was withdrawn subject to reinstatement upon terms agreed to by the parties.
On June 06, 2010, the Court Ordered that the appeal be reinstated.
On June 09, 2010, the Court Ordered that the Appellants' motion for remand to the district court, on consent, was Granted.
On August 02, 2010, the parties to the Ontario, Quebec and U.S. actions have agreed to settle the plaintiffs' claims. A settlement agreement was made without any admission of liability, wrongdoing or fault by the defendants.
On October 14, 2010, the parties to the action entered into a Settlement Agreement, which is subject to review under Rule 23 of the Federal Rules of Civil Procedure and which, set forth the terms and conditions for the proposed settlement of the claims alleged in the Complaint on the merits and with prejudice.
On March 02, 2011, an Order Approving Plan Of Allocation and an Order Awarding U.S. Class Counsel Attorneys' Fees and Expenses were issued by the Court.
On March 02, 2011, an Order and Final Judgment found that the Settlement Agreement and settlement are fair, reasonable and adequate as to each of the members of the Class, and that the Settlement Agreement and settlement was finally approved in all respects.