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More trouble for Welspun India: Two class action lawsuits filed against textile maker in US

In more trouble for textile manufacturer Welspun India and its US subsidiaries, two class action lawsuits have been filed against the company here alleging it perpetrated "widespread fraud" for years...

By: | New York | Published: September 16, 2016 8:09 PM
The lawsuit has been filed in the US District Court in the Southern District of New York by Meghan Abbott, a North Carolina resident who purchased bed linens by Welspun from retail store Target. (Reuters) The lawsuit has been filed in the US District Court in the Southern District of New York by Meghan Abbott, a North Carolina resident who purchased bed linens by Welspun from retail store Target. (Reuters)

In more trouble for textile manufacturer Welspun India and its US subsidiaries, two class action lawsuits have been filed against the company here alleging it perpetrated “widespread fraud” for years by using inferior and less expensive cottons in its bedsheets and towels and marketing them as premium Egyptian cotton.

The lawsuit has been filed in the US District Court in the Southern District of New York by Meghan Abbott, a North Carolina resident who purchased bed linens by Welspun from retail store Target.

A second lawsuit has been filed in a St Louis federal court. Both lawsuits are claiming minimum damages of USD 5 million each.

The lawsuit alleges “widespread fraud perpetrated by one of the world’s largest textile makers” Welspun India and its US subsidiaries.

“For years, Welspun has sold and marketed bed linens as made from Egyptian cotton, which commands a premium in the market because it is perceived as higher quality,” the lawsuit alleges.

“In fact, Welspun uses inferior and less expensive cottons in many of its Egyptian cotton bed linens. As a result, consumers who have purchased Welspun bed linens have overpaid for an inferior product. This action seeks full recompense for Welspun consumers as well as punitive damages for the egregious conduct,” it said.

Citing a corporate presentation by Welspun that claimed “Your comfort is our commitment”, the lawsuit said Welspun’s commitment is to its own profits rather than the consumer.

It said due to the false misrepresentation that 100 per cent Egyptian cotton was used in its products, “plaintiff and class members were injured. Specifically, they paid a premium for ‘100 per cent Egyptian Cotton’ bed linens but received bed linens that were not ‘100 per cent Egyptian Cotton'”.

The lawsuit demands an order temporarily and permanently enjoining Welspun from continuing the “unlawful, deceptive, fraudulent, and unfair business practices” seeking costs, restitution, damages, including statutory and punitive damages.

Last month US retail giant Target terminated its relationship with Welspun India after an extensive investigation found that Welspun had substituted another type of non-Egyptian cotton when producing bed linens between August 2014 and July 2016 and had marketed them as premium cotton.

Joining Target, US retail behemoth Walmart said it too was pulling the supplier’s Egyptian-cotton sheets over concerns that the products’ origins may be mislabeled.

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