Boohoo faces further £10 million legal claims over Leicester supply chain scandal
Boohoo is facing £10 million worth of new legal claims from investors who are alleging that its top leaders knew the company was using ‘sweatshops’ in Leicester to make its clothes.
According to The Telegraph, a further 11 institutional investors have joined a High Court lawsuit against Boohoo, including Bank of Korea and Stichting Shell Pensioenfonds, a pension fund for Shell’s employees in the Netherlands.
Subscribe to TRBUS pension funds for public sector employees, including Illinois Municipal Retirement Fund and the Public Employees’ Retirement System of Mississippi, have also joined the claim.
The new claims have taken the value of compensation sought to £245 million.
The High Court lawsuit followed a 2020 slump in Boohoo’s share price which was triggered by revelations of its use of Leicester factories where staff were working in “terrible” conditions and were often paid less than the minimum wage
In September 2020, Boohoo announced that an independent review of its Leicester supply chain, led by barrister Alison Levitt, had identified a number of failings and recommended that it make improvements to its corporate governance, compliance and monitoring processes. However, the review also found that Boohoo did not deliberately allow the poor conditions to exist and did not intentionally profit from them.
In a filing to the High Court in London, lawyers from Fox Williams, who are representing the investors, said: “The claims stem from revelations… about the underpayment of workers and unacceptable working conditions within Boohoo’s Leicester supply chain.
“The claimants allege that these and (other matters) were not properly disclosed by Boohoo when they ought to have been and that they relied on misleading/untrue statements or omissions.”
A Boohoo spokesman told The Telegraph: “The company strongly contests the allegations and will vigorously defend any claim.”
