LONDON (Reuters) -Boohoo said on Tuesday that it had reached a final settlement with a U.S. class action lawsuit that said the British online fashion store’s ads in California misled customers.
In November, the group, which sells clothes, shoes, accessories, and beauty products for people aged 16 to 40, reached a preliminary agreement to end the lawsuit.
Boohoo said that the settlement does not admit fault and is within the law. As of February 28, the settlement was worth $22.4 million, which is 17.8 million pounds.
The settlement won’t be final until the United States District Court for the Central District of California looks at it and says it’s okay.
Analysts at Jefferies said, “It must be a small plus to have the problem solved and covered by existing provisions.”
At 7:43 GMT, however, Boohoo stock was down 4.5 percent, bringing the loss for the year to 36 percent.
ASOS (LON:ASOS) was down 2.4% and Next was down 1.7%, which showed that the sector was weak.
Earlier this month, Boohoo warned sales growth would slow this year, hit by a squeeze on consumer spending, higher product return rates and continuing supply chain and delivery problems.
(1 dollar = 0.7943 pounds)
