Only two days ago, I blogged about investigations in the UK for greenwashing claims made by clothing companies Asos, Boohoo and Asda. To add to that here in the U.S., The Fashion Law reported on a class action lawsuit filed against international clothing giant H&M for misleading sustainability claims.
According to the proposed class action complaint that she filed in a New York federal court on July 22, Plaintiff Chelsea Commodore claims that in an attempt to target the growing segment of eco-conscious consumers who are willing to pay more for “sustainably-made” garments and accessories, the Swedish fast fashion giant prominently incorporated “‘environmental scorecards’ for its products called ‘Sustainability Profiles’” into the labeling, packaging, and marketing materials for hundreds of its offerings – only to ultimately remove them after being called out for using “falsified information that did not comport with the underlying data.”
In the newly-filed complaint, Commodore alleges that “despite its position as a fast-fashion giant, H&M has created an extensive marketing scheme to ‘greenwash’ its products” in order to present them “as environmentally-friendly when they are not.” Part of this overarching effort comes in the form of its “misleading” environmental scorecards, which are prominently displayed on “green hang tags, in-store signage, and online marketing”…
Commodore claims that H&M is engaging in deceptive acts or practices and false advertising in violation of New York General Business Law by way of its alleged “misrepresent[ation of] the sustainability and attributes of the products to induce consumers to purchase H&M’s products,” and given that “a consumer acting reasonably under the circumstances would reasonably believe those claims, particularly given that H&M is a nationally recognized and well-established company.” (Commodore further asserts that H&M “seeks to differentiate itself from other fashion products by greenwashing the products and its brand,” which is “a deceptive act and an unfair practice because [H&M], one of fashion’s greatest polluters, knows that the products are not sustainable and contribute to significant negative environmental harms over the entire product life cycle from cultivation to incineration.”) She also sets out a claim of unjust enrichment, arguing that H&M benefitted from such unfair acts.
As for injury, Commodore, who paid a total of $50 for a sweater and a cardigan from H&M’s Conscious Collection, claims that she and “members of the class have suffered economic injury because [they] would not have purchased the products or paid as much if the true facts had been known, [thereby, causing them to] suffer damages.”
Our view: The article doesn’t go into detail on the point that H&M relies on the Higg Index for its sustainability determinations, claims and ratings. The Sustainable Apparel Coalition (which runs the Higg Index) has posted a statement responding to other claims involving H&M. The Fashion Law article provides a summary of what I think one takeaway is:
The case comes amid a boom in sustainability-focused marketing endeavors by brands looking to cater to eco-conscious consumers, complete with a proliferation of misleading “sustainable” marketing – from consumer-facing ads (complete with sustainability-inspired logos) to language in investor filings. To date, most brands have been able to avoid litigation and regulatory action in response to potentially misleading sustainability and broader ESG claims, but that may be changing.
But I think there is another aspect to this: risks of blindly relying on industry programs, ratings and rankings for sustainability attributes. This isn’t anything new – I wrote about this last year. Companies should consider doing their own due diligence into industry ESG programs/solutions, make determinations about potential risks and find ways to address any concerns/manage the risks.
