The complaint filed by Robbins LLP alleges that Gildan’s offering documents contained materially misleading statements regarding the company's revenue growth. According to the lawsuit, Gildan engaged in systematic channel stuffing to meet quarterly targets, pulling sales forward while overloading intermediaries with inventory that remained unsold. These practices reportedly masked unsustainable demand and rendered the growth metrics presented during the merger unrealistic.

The scrutiny intensified on June 16, 2026, when investigative firm Jehoshaphat Research released a 60-page report detailing these allegations. The market reaction was swift, with Gildan’s stock price dropping more than 18%, falling from $61.97 to $50.34 in a single day. Former HanesBrands shareholders who received Gildan securities in the cash-and-stock exchange may be eligible to participate in the class action as the firm seeks a lead plaintiff to represent the investor group.