US: Skechers to pay $50m to settle toning shoe claims
Footwear firm Skechers USA has agreed to pay $50m to settle what are described as "unfounded" advertising claims that its toning shoes would help wearers improve their fitness and lose weight.
The settlement comes eight months after sportswear maker Reebok International Ltd also said it would pay $25m in customer refunds for making similar claims about its toning footwear.
Skechers says it has agreed to the payment to avoid the cost and distraction of protracted legal battles - but denies the allegations and believes its advertising was appropriate. The one-time settlement consists of $45m in customer refunds plus $5m in attorneys' fees, the California-based firm said yesterday (16 May).
"While we vigorously deny the allegations made in these legal proceedings and looked forward to vindicating these claims in court, Skechers could not ignore the exorbitant cost and endless distraction of several years spent defending multiple lawsuits in multiple courts across the country," said chief financial officer David Weinberg.
"This settlement will dispose once and for all of the regulatory and class action proceedings."
The US Federal Trade Commission (FTC), meanwhile, says the company deceived consumers by making unfounded claims that Shape-ups would help people lose weight, and strengthen and tone their buttocks, legs and abdominal muscles.
"Deceptive claims" were also made about the Resistance Runner, Toners, and Tone-ups shoes, it alleges.
"Skechers' unfounded claims went beyond stronger and more toned muscles. The company even made claims about weight loss and cardiovascular health," said David Vladeck, director of the FTC's Bureau of Consumer Protection.
Under the settlement, Skechers is barred from making any health or fitness-related claims about its toning shoes and other toning apparel unless they are true and backed by scientific evidence.
But the company says it will continue to make and sell the toning shoes.
"The company fully stands behind its toning shoe products and technology and is permitted under the settlement to continue to advertise that wearing rocker-bottom shoes like Shape-ups can lead to increased leg muscle activation, increased calorie burn, improved posture and reduced back pain," said Skechers president Michael Greenberg.
Industry-wide sales of toning footwear peaked at close to $1bn in 2010. Shape-up fitness shoes, which Skechers introduced in April 2009, cost consumers about $100 a pair. Resistance Runner, Toners, and Tone-ups became available in mid-2010, and retailed for $60 to $100 a pair.
Sporting goods powerhouse Adidas has posted double-digit increases in profit and revenues in the third quarter, despite continuing worries about its under-performing Reebok brand....
Footwear firm Skechers USA has seen its third-quarter net profits rise on the back of sales growth at its own stores and its wholesale division amid challenging trading conditions in Europe....
Adidas has made dramatic cuts to the long-term revenue targets for its Reebok brand, which has been impacted by lost business in the US and fraud allegations in India....
Reebok, which is owned by sporting goods giant Adidas, has removed the position of global president, moving Ulrich Becker to president of the brand's North American business....
Some 100 Adidas workers at its Reebok India business are staging protests against the sportswear giant's new franchise model, according to reports....
Footwear maker Skechers has teamed up with Dallas Mavericks owner Mark Cuban, and sports professionals Joe Montana and Tommy Lasorda, to launch a Relaxed Fit men's footwear collection....
The Finish Line has appointed Harvey Bierman as vice president of digital technology as the US sportswear chain continues to expand its digital business....
- What the EU-Vietnam trade deal means for duties
- Ultimate frontier Myanmar uplifts Bogart Lingerie
- US apparel retailers' January 2016 sales roundup
- US apparel import growth led by Bangladesh
- Esquel backs Chinese Sea Island cotton production
- Sears looks to lift apparel via sourcing changes
- Direct sourcing helps M&S narrow the gap with Next
- Eco-friendly garment factory opens in Bangladesh
- Clothing and sports chains in activewear battle
- Nike accelerates digital strategy with new hire
- Southeast Asia strategic sourcing review – a focus on Cambodia, Vietnam and Myanmar
- Wearable technology: The future market potential for smart garments and e-textiles
- Global market review of denim and jeanswear – forecasts to 2021
- Practical Price Negotiation
- Wearable Technology Market by Product, Application, Type, & Geography - Global Forecast to 2020