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Walmart, Target to Face Lawsuit Over False Egyptian Cotton Claims

Walmart, Target and Bed Bath & Beyond are set to face a lawsuit over claims of mislabeling Egyptian cotton.

In the latest chapter of a case that’s been ongoing, accusing the three retailers of allegedly selling falsely labeled “100% Egyptian Cotton” bed sheets made by a U.S. unit of Indian-based textile firm Welspun, U.S. District Judge Vincent Briccetti ruled on Monday that consumers can pursue breach of warranty and negligent misrepresentation claims against the retailers and the manufacturer.

The decision also addressed claims that consumers nationwide overpaid for mislabeled cotton produced by Welspun India Ltd. Egyptian cotton is considered one of the most luxurious and most expensive varieties of the fiber in the world.

As Briccetti, of the Southern District of New York in White Plains, N.Y., noted, Walmart, Target and Bed Bath & Beyond must face the suit brought by consumers who said they sold linens that were falsely labeled as being made with Egyptian cotton even though the stores were suspicious of their origin. The retailers won’t however, be accused of fraud, as Briccetti could not strongly infer fraudulent intent.

The complaint alleges that the retailers sold Welspun’s “Egyptian” cotton bedding through 2016 even though Target and Bed Bath & Beyond had known for several months, and Walmart had known as early as 2008, that the cotton was mislabeled. The sheets were sold under the Fieldcrest, Royal Velvet, Better Homes and Gardens, Canopy, Crowning Touch and Perfect Touch brands, according to court documents.

Target stopped doing business with Welspun in August 2016, and Walmart and Bed Bath & Beyond stopped selling the linens in question later that year. The litigation combined several lawsuits. It was reassigned to Briccetti after the original judge, Richard Sullivan, was promoted to the federal appeals court in Manhattan.

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In December 2018, the Egyptian government appointed an official steering committee to safeguard the future of the Egyptian Cotton brand. Khaled Schuman, head of the newly formed Egyptian Cotton Logo Unit, said, “We are aware that deceptive practices by some manufacturers are damaging the Egyptian Cotton brand. It has, in some cases, resulted in a loss of confidence and trust, neither of which are acceptable. We will reinforce the credentials of genuine Egyptian Cotton as an ethical and sustainable brand, the cultivation and production of which supports whole communities.”

Recent moves to improve confidence in the Egyptian Cotton logo include the introduction of a partnership with Bureau Veritas for a new rigorous accreditation process that uses DNA testing to distinguish between genuine Egyptian Cotton and regular cotton.