Fruit of the Loom has called off legal proceedings against Gildan Activewear.

In April, it accused rival t-shirt manufacturer Gildan Activewear of industrial espionage saying Gildan stole the company's operating plans and lured away some of its top executives.

A US district court judge in Illinois had issued an order for a return of the documents and that Gildan not use or disclose any information contained in them, including sales strategies, customer information, product development plans and pricing strategies.

There has been speculation that Gildan is negotiating the purchase of some of the assets of Fruit of the Loom, which is operating under Chapter 11 bankruptcy court protection. Gildan wouldn't comment on these reports.