A Florida distributor says it spent about $80 million bailing Gap out of the pandemic. It is now a defendant in Gap's breach of contract case.
In early 2020, the retail industry stopped. Stores locked their doors. Merchandise piled up where it sat. Factories overseas were holding goods and fabric made for orders nobody was going to take delivery of.
SVES says that is when Gap's executives came looking for it.
WHAT SVES SAYS IT DID
SVES buys surplus clothing from retailers and resells it to discounters. Its co founders are Timothy J. Fullum and Salomon Murciano.
What happened next is laid out in the lawsuit SVES later filed. It secured a warehouse of roughly three million square feet. It pulled merchandise out of Gap owned stores across the whole portfolio, Gap, Banana Republic, Old Navy, Janie & Jack, Athleta, Intermix. Then Gap said its overseas suppliers were in trouble, and SVES says it absorbed what those suppliers were stuck with. Not only the finished clothes. The fabric too.
SVES puts the total at approximately $80 million paid out to Gap’s stores and Gap’s suppliers.
There is a phrase in the cross complaint that SVES attributes to Gap. It says it was asked to help Gap "clean up their mess."
THE RELATIONSHIP THAT FOLLOWED
On or about July 6, 2020, the two companies signed a reseller agreement. Over the next two years SVES bought millions of units of Gap inventory, and the relationship grew.
Then came August 2022 and a set of purchase orders for 10,060,207 pieces of Old Navy merchandise, invoiced at $17,655,076.08.
SVES says what arrived in its warehouses was not what it ordered. It says the shipments were loaded with plus size goods it had never asked for in anything close to those quantities.
FROM SETTLEMENT TO LAWSUIT
After months of negotiation, SVES signed a settlement in October 2023 agreeing to pay Gap more than $26 million. It made payments until April 5, 2024. Then it stopped, saying by then it understood how much of the merchandise was wrong.
Gap sued seven weeks later.
SVES answered with a cross complaint alleging fraud and deceit, negligent misrepresentation, breach of contract, breach of good faith, two counts of interfering with its customer relationships, and unfair competition. It is asking for no less than $378 million and it has demanded a jury.
Q: DID THE COURT DECIDE WHO IS RIGHT?
A: Only on one narrow question, and it went against SVES.
In July 2026, Judge Stephen M. Murphy ruled against SVES in the first phase of trial, holding it could not undo the October 2023 settlement. He was precise about the limits of that. He made no finding on whether Gap’s statements were false. The fraud claim has not been heard by anyone.
PUT THE FACTS TOGETHER
So a company that says it emptied Gap’s warehouses when Gap asked is now being sued by Gap for money, and the question of how millions of unwanted garments ended up in its buildings remains, four years on, unanswered.
A company that says it rescued Gap in 2020 is the company Gap sued in 2024.