Canadian apparel maker Gildan Activewear has reached a US$1m settlement with Russell Brands, a Fruit of the Loom company, to resolve a trademark infringement lawsuit.

The lawsuit, which was filed in the US District Court for the Western District of Kentucky in October, relates to the relabelling and resale of products under Russell Brands' Jerzees label.

When Gildan Activewear took on a contract to supply men's and boy's fleeces to a retailer, which was previously supplied by Russell Brands under the Jerzees label, it had to acquire a certain amount of inventory.

However, some of the Jerzees merchandise the company had purchased was shipped back to retail customers under the Gildan label.

"As soon as we found out that this happened, we took immediate steps to correct the situation by retrieving all of the product, which had been shipped to the retailer," a spokesperson for the company told just-style yesterday (4 March).

"In addition to taking immediate action to take the inventory back, we have also taken necessary steps to strengthen our internal control in order to ensure that such an event does not reoccur."

Gildan Activewear offered a $1m settlement "to put this matter behind us" and it was excepted by Russell Brands, the spokesperson added, but emphasised there was no admission of liability by Gildan.