Gildan Activewear became the latest sporting goods company targeted by class-action securities litigation, but this time the suit actually has a lead plaintiff. Gildan faces the possibility of a $500-million class-action lawsuit over allegations executives earned millions by selling shares before news of problems at the company's Dominican Republic plant sent the companys stock plummeting.
German institutional investor Metzler Investment GMBH is the lead plaintiff in the proposed suit, claiming to have lost approximately $900,000 after information about the problems at the plant was released. Metzler argues that Gildan knew or ought to have known the severity of the problems at the Dominican facility, and had a duty to promptly pass that information on to investors.
Metzler alleged Gildan CEO Glenn Chamandy and a holding company in his name made $95.2 million selling shares between Aug. 9 and Dec. 5, 2007
