Gap's own negotiator testified to the limit. The purchase orders backed him up. SVES says more than nine million arrived.
Stephen Brown worked for Gap. He was the company’s representative on the deal at the center of this case, and this spring he took the stand in a San Francisco courtroom.
His testimony is recorded in the judge’s written decision. Brown said the two sides discussed and agreed that the orders would include no more than about 500,000 plus size units out of roughly 10 million total, with perhaps another 500,000 added later through future purchase orders.
TWO THINGS POINTING THE SAME WAY
Judge Stephen M. Murphy translated Brown’s testimony into a percentage: somewhere between 5 and 10 percent of the merchandise.
Then he noted that the paperwork agreed with Brown. The ten purchase orders, admitted at trial as Exhibits E through O, itemized the inventory to be purchased. They contained less than approximately 1 million plus size items.
Two independent things pointing the same way. The Gap employee who cut the deal, under oath. And the documents that recorded it.
WHAT SVES SAYS SHOWED UP
SVES says what showed up was close to the reverse. In its cross complaint, it alleges the orders called for about 90 percent regular sizes and 10 percent oversized, and that Gap instead filled the shipments with roughly 80 to 90 percent oversized garments and only 10 to 20 percent regular.
The judge’s decision records SVES’s position after the counting was done. Of the 10,060,207 units, SVES asserts more than 9 million were BodEquality merchandise, Old Navy’s extended size line.
THE COURT’S OWN NUMBER
There is a second figure in the record that is not SVES’s claim but the court’s own observation. By October 3, 2023, SVES’s warehouse had inspected over 7.3 million of the roughly 10 million units, and the judge wrote that this count was far more plus size than Brown had indicated would be shipped, and far more than Gap had represented in writing.
The orders themselves were placed in or about August 2022. Ten of them, numbered ON00020US through ON00030US. The invoice came to $17,655,076.08.
Q: WHY DOES THE SIZE MIX MATTER FINANCIALLY?
A: Because the judge made a specific finding on this point.
The proportion of regular size to extended size inventory was material, because the two carried materially different values and marketability. In the off price trade, a shipment weighted toward slow selling sizes is simply worth less.
WHAT WAS DECIDED, AND WHAT WAS NOT
Gap sued SVES in May 2024 after SVES stopped paying. SVES countersued for no less than $378 million.
In the first phase of trial the judge ruled against SVES on whether it could tear up a later settlement. He did not rule on whether the wrong goods were shipped. Nobody has ruled on that.
Five hundred thousand, Gap’s man said, with perhaps five hundred thousand more.